Packaging M&A (Cont’d from Page 1)
The average multiple of publicly traded plastic pack- aging companies reached 11.6x, the highest point of this decade. The average multiple of publicly traded paper packaging companies decreased to 7.7x, largely driven by the corrugated industry, which experienced a simultaneous increase in containerboard capacity and decline in containerboard pricing. Despite fears of a recession due to the unprecedent- ed length of this bull market, we do not see any imme-
nilox
ANILOX THAT EXCEED EXPECTATION
diate issues that we expect to negatively impact the market for the remainder of this year and into 2020. The Federal Reserve’s recent interest rate cut has both dramatically changed the overall outlook for financial markets and the global economy, instilling confidence in the M&A market. The packaging sector continues to see increased in- vestments from public companies and private equity, with valuation levels nearing all-time highs. With M&A activity in the plastics and packaging sector remaining strong, it is worth noting the most active sectors driv- ing overall packaging deal volume: corrugated, flexible packaging, labels and rigid plastics. Corrugated Corrugated deal activity remains robust and multiples remain at record levels as industry participants contin- ue to focus on increasing integration levels. Over the past year alone, there have been 24 transactions in the U.S. corrugated market. One of the larger corrugated M&A deals in the first half of 2019 was DS Smith’s ac- quisition of Papeles y Cartones for $2.2 billion. Growth of e-commerce continues to drive increased demand of corrugated packaging. Retail giants such as Walmart and Best Buy are attempting to compete with Amazon in the online retail space by decreasing their shipping costs through reducing the material weight of their packaging. The Future of Corrugated Packaging estimates that $20 billion worth of corrugated materi- als are used in the e-commerce sector as a whole. With
Thanks to our growing customer base, Pamarco continues to expand capabilities. Our reputation is based on consistency and dependability. Let us demonstrate how Pamarco can become an important partner in your success.
Contact us today for your Pamarco Anilox Products kara.wojnowski@pamarco.com or 404-691-1700
www.pamarco.com kara.wojnowski@pamarco.com +404-691-1700
(Cont’d on Page 11)
Flexo Market News August 5, 2019 5
www.nvpublications.com
Made with FlippingBook - Online catalogs