Sonoco to acquire KPS’ Eviosys in $3.9bn deal

September 2024 | DEALFRONT | PRIVATE EQUITY & VENTURE CAPITAL

Financier Worldwide Magazine

September 2024 Issue

In a deal designed to expand its metal and aerosol packaging business, consumer packaging provider Sonoco Products Company is to acquire Eviosys, a portfolio company of private equity firm KPS Capital Partners’, for $3.9bn.

Under the terms of the agreement, Sonoco will acquire Eviosys on a cash-free, debt-free basis and has committed financing for the entirety of the transaction price.

The acquisition of Eviosys accelerates Sonoco’s strategy to focus on and scale its core businesses and invest in high return opportunities, both organically and inorganically. Following completion, Sonoco will be the leading metal food can and aerosol packaging manufacturer globally.

A leading global supplier of metal packaging to preserve the products of hundreds of consumer brands, Eviosys has the largest metal food can manufacturing footprint in the Europe, Middle East and Africa (EMEA) region, with approximately 6300 employees in 44 manufacturing facilities across 17 countries.

Sonoco estimates Eviosys’ 2024 revenues will be approximately $2.5bn and its 2024 adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) will be approximately $430m. Eviosys has meaningful commercial and operational momentum and has increased EBITDA by approximately 50 percent since 2021.

The boards of directors of both Sonoco and Eviosys have unanimously approved the transaction.

“The acquisition of Eviosys establishes our global leadership in metal food can and aerosol packaging, marking an exciting milestone in our strategy to scale our core strategic metal packaging platform and position Sonoco for long-term value creation,” said Howard Coker, president and chief executive of Sonoco. “Eviosys brings extensive global reach and an attractive, growing customer base that perfectly complements our existing metal packaging offering.”

KPS created Eviosys to acquire Crown Holdings’ EMEA Food and Consumer Packaging Business in August 2021 in a highly complex global corporate carve-out transaction. “We are proud of Eviosys’ extraordinary transformation under our ownership,” said Michael Psaros, co-founder and co-managing partner at KPS. “Eviosys demonstrates our ability to build industry-leading companies on a global basis. We believe the acquisition of Eviosys by Sonoco will benefit the combined companies’ customers, employees and investors.”

In under three years of ownership, KPS successfully transformed Eviosys into a fully independent and significantly more profitable company focused on growth, innovation and sustainability. “KPS recognised the investment opportunity and upside presented by Eviosys,” said Tomás López, chief executive of Eviosys. “KPS’ extensive manufacturing expertise and experience provided us with the plan and resources that resulted in enormous value creation.”

Serving as sole financial adviser to KPS and Eviosys is Rothschild & Co, with Paul, Weiss, Rifkind, Wharton & Garrison LLP serving as legal counsel. Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC are serving as financial advisers to Sonoco and Freshfields Bruckhaus Deringer LLP is serving as Sonoco’s legal counsel.

The transaction is expected to close by the end of 2024, and is subject to completion of required works council consultations and the receipt of required regulatory approvals and other customary closing conditions.

Mr Coker concluded: “Together with the talented team at Eviosys, we are focused on unlocking new opportunities in attractive end-markets, providing our customers with a stronger value proposition and generating strong returns for our shareholders.”

Fraser Tennant