Acquisition attempt

Berry reports intent to acquire RPC; creating global plastic and recycled packaging product franchise

| Management | Berry Global Group | Evansville, IN | United States
  • Transformational complementary combination establishes a global leader in plastic packaging and recycled solutions
  • Further strengthens Berry’s long-term industry position and offers additional growth opportunities
  • Global franchise provides for enhanced commercial and operational balance across geographies, manufacturing technologies, products, and substrates
  • Opportunity to generate annual cost synergies of $150 million
  • Acquisition expected to be accretive to free cash flow and earnings

Berry Global Group, Inc. (Berry) announced a recommended superior offer to acquire all of the issued and to be issued ordinary share capital of RPC Group Plc (RPC) for 793 pence per share in cash. Aggregate consideration will be approximately £5.0 billion ($6.5 billion), including refinancing of RPC’s net debt.

RPC is a leading international design and engineering company, providing plastic and recycled products for packaging and selected non-packaging markets. With a focus on rigid and flexible packaging, RPC maintains strong leadership positions across a range of consumer, industrial, and healthcare end markets. Supported by 153 manufacturing locations, commercial presence in 33 countries, an employee base of approximately 25,000 and the broadest range of conversion technologies in the industry, RPC serves more than 10,000 customers, combining large company resources with local, in-market expertise. For the twelve-month period ended September 30, 2018, RPC generated net sales and adjusted EBITDA of $4.8 billion and $768 million, respectively.

“We are extremely excited about the opportunity to welcome the team and global capabilities of RPC to the Berry organization. We are highly impressed by the tremendous depth of talent and resources embedded within RPC, and are looking forward to the opportunity to strengthen our combined platform with the wealth of experience and expertise this team has to offer,” said Tom Salmon, Chairman and CEO of Berry. “We believe this transaction will further enhance the long-term outlook for our business and will provide a unique value creation opportunity for our shareholders. We plan to leverage our combined know-how in material science, product development, supply chain and manufacturing technologies across resin-based applications to integrate quickly and build a best-in-class organization.”

Berry and RPC are two companies with complementary plastic packaging product offerings and strong cultural compatibility. The combined company will have combined revenue of approximately $13 billion and approximately 48,000 employees across six continents.

The board of directors of RPC has unanimously recommended the superior offer by Berry. The proposed transaction, which is subject to customary closing conditions, is expected to close early in the third quarter of calendar year 2019.

Berry has secured a fully-committed debt financing package to fund the transaction, and intends to utilize the enhanced free cash flow of the combined business to reduce leverage quickly from expected pro forma net leverage of approximately 5.0x at close. As part of the transaction, Berry expects to generate approximately $150 million of annual cost synergies.

Goldman Sachs and Wells Fargo Securities are retained as joint lead financial advisors to Berry. Freshfields Bruckhaus Deringer LLP and Bryan Cave Leighton Paisner LLP are retained as legal advisors for Berry. JPMorgan is also retained as a financial advisor to Berry.

Goldman Sachs and Wells Fargo Securities provided fully-committed financing in connection with the transaction.

www.berryglobal.com





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