Dive Brief:
- Novolex completed its acquisition of Pactiv Evergreen. The all-cash deal is valued at approximately $6.7 billion.
- This deal takes Pactiv private. Its stock has been delisted from the Nasdaq, according to a Tuesday securities filing, and shareholders received $18 per share in cash.
- The combined company will operate under the Novolex name and will be headquartered in Charlotte, North Carolina, Novolex’s home base. It now has more than 20,000 employees.
Dive Insight:
This transaction creates one of the largest food packaging producers, with manufacturing and distribution presence in the U.S., Canada, Mexico and Europe, according to the company’s news release. The combined company has 250 brands and 39,000 SKUs across various packaging substrates.
Novolex CEO Stan Bikulege will lead the combined company, and other senior leaders from Novolex and Pactiv Evergreen will round out the executive leadership team. For instance, Dennis Norman of Novolex is chief financial officer, Doug Owenby of Novolex is interim chief operating officer and Chuck Whittington of Pactiv Evergreen is chief transformation officer. The companies disclosed that former Pactiv Evergreen CEO Mike King will serve as an advisor to Novolex.
Tuesday’s news release included a statement from Bikulege that alluded to potential synergies that will be realized under the combination.
"Together, we'll continue to solidify our position and deliver in the markets we serve by optimizing operations, accelerating product innovation and driving commercial excellence while maintaining sustainable growth across the business,” he said.
King said in a statement, “I am confident in the future of the combined business and team under Stan's leadership to become a stronger partner of choice for customers and deliver unmatched solutions that support their packaging needs and sustainability goals."
The companies first publicly announced their intentions to combine on Dec. 9. At that time, King said Pactiv Evergreen’s board and leadership team evaluated other opportunities prior to agreeing to the Novolex deal. He also said that Pactiv had “made significant progress on our transformation, focusing on our core strengths while driving operational excellence and enhancing profitability” over the last three years.
The company had endured years of challenges with weak demand and revenue dips. Pactiv Evergreen underwent a restructuring in 2023. That year it also closed a paper mill in Canton, North Carolina, and a converting facility in Olmsted Falls, Ohio, eliminating a total of 1,300 jobs. King then detailed on a March 2024 earnings call another restructuring plan that would affect 10% of Pactiv Evergreen’s footprint, and he announced further cuts during the August earnings call.
In August 2024, the company announced it had sold two mills — in Pine Bluff, Arkansas, and Waynesville, North Carolina — to Brazilian pulp and paper company Suzano for $110 million. And in February, Pactiv Evergreen disclosed plans to permanently close a facility in Kalamazoo, Michigan, and lay off 153 employees.
Pactiv Evergreen formed in 2020 through the combination of Evergreen Packaging and Pactiv, both of which were previously acquired by Reynolds Group Holdings. It became a publicly traded company at that time.
Novolex has continued its expansion through acquisitions in recent years, including acquiring the assets of paper bag handle manufacturer American Twisting in September. In 2022, Apollo Funds acquired a majority stake in Novolex from Carlyle, which retained a minority stake.
