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Berry Plastics Buys AEP Industries For $765 Million

Berry Plastics Group, Inc. BERY 2.29% and AEP Industries Inc. AEPI 41.35% reached a definitive deal by which the former would buy the latter in a cash and stock transaction worth about $765 million. This included assumed net debt. The companies expect the transaction to be completed in December current year.

According to the company, every AEP shareholder would get either cash of $110 or 2.5011 shares of Berry. However, this subject to the overall proportion of 50/50 to ensure half of the shares is exchanged for cash.

Once the transaction is completed, AEP shareholders would have about five percent on Berry. The company indicated that the consideration price was based on a blended value of the merger representing $110 a share.

Berry's chairman and CEO, Jon Rich, commented, "We respect and admire the impressive company Brendan Barba has built over the last 40 years and look forward to welcoming AEP employees into Berry's organization. AEP, together with Berry's Engineered Materials Division, creates an impressive packaging film producer serving the North American market."

Berry expects the deal to be accretive to its adjusted earnings and adjusted free cash flow by over 10 percent, after expected synergies. The company indicated that the transaction would deleverage its balance sheet after synergies.

On Wednesday, Berry closed at $43.28.

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