DELAWARE, Ohio – Packaging maker Greif, Inc. has entered into a definitive agreement to acquire Caraustar Industries, Inc., a recycled paperboard and packaging solutions company, from an affiliate of H.I.G. Capital.
The cash transaction is valued at US$1.8 billion. The transaction is expected to close during the first quarter of calendar year subject to customary closing conditions, including regulatory clearances.
Caraustar is a market leader in the production of uncoated recycled paperboard (URB) and coated recycled paperboard (CRB), with a variety of applications that include tubes and cores and a diverse mix of specialty products. Based in Austell, Georgia, Caraustar’s footprint includes over 80 operating facilities throughout the United States.
“Caraustar offers an exceptional strategic and cultural fit for Greif,” said Greif’s president and CEO, Pete Watson.
“Its complementary paper packaging and recycled fiber operations will drive significant free cash flow growth, improve balance and profitability within the Greif portfolio and increase Greif’s exposure to U.S. industrial and consumer end markets. Most importantly, Greif and Caraustar share the same dedication to providing industry-leading service to all customers. I am excited to welcome our new colleagues to the Greif family and look forward to working closely with them.”
“We are excited about today’s announcement and what it means for Caraustar’s customers and employees,” added Caraustar president and CEO, Mike Patton.
“Greif is a well-known market leader with a strong manufacturing base. Our customers will benefit from Greif’s customer service focus and broad product offering and our employees will join a culture with a strong legacy for service and quality.”
Greif produces steel, plastic and fibre drums, intermediate bulk containers, reconditioned containers, flexible products, containerboard and packaging accessories and provides filling, packaging and other services for a wide range of industries. It also manages timber properties in the southeastern United States.
Caraustar’s four business lines include Recycling Services, Mill Group (coated and uncoated paperboard and specialty paperboard products), Industrial Products Group (tubes and cores, construction products, protective packaging, adhesives) and Consumer Packaging (folding cartons, set-up boxes, packaging services). Caraustar serves the four principal recycled boxboard product end-use segments: tubes and cores; folding cartons; gypsum facing paper; and specialty paperboard products.