Boise to acquire Hexacomb protective packaging business

Oct 04, 2011. /Lesprom Network/. Boise Inc. announced its board of directors has approved an agreement under which Boise will acquire the Hexacomb protective packaging business of Pregis Corporation. Boise expects the $125 million all-cash transaction to close by year end 2011 or early 2012. Hexacomb is a leader in kraft paper-based honeycomb protective packaging products and employs approximately 440 employees at 12 manufacturing facilities across six countries. In 2010, Hexacomb had revenues of $102 million and converted approximately 60,000 tons of containerboard. "Our acquisition of Hexacomb presents another excellent opportunity to expand in packaging markets and create value for our shareholders and customers, building on our acquisition of Tharco earlier this year," said Alexander Toeldte, president and CEO of Boise Inc. "Hexacomb has demonstrated strong growth in both sales and profitability, with compound annual sales growth over 10% since 2009. Hexacomb operates in a growing market that is complementary to our existing packaging business and provides another substantial step up in vertical integration within our existing packaging business, creating value by increasing margins and reducing our reliance on linerboard export markets. Furthermore, as a leader in honeycomb protective packaging, Hexacomb provides a solid platform for additional growth both domestically and internationally,” Alexander Toeldte added. "When complete," said Mr. Toeldte, "we expect annualized synergies of approximately $5 million, achieved primarily through increased integration along with targeted cost savings and incremental growth. We anticipate these synergies will be fully realized in 24 months. The acquisition will be financed using cash on hand, and we expect the transaction to be accretive to our earnings in the first twelve months." "Hexacomb's leadership in sustainable protective packaging is an optimal fit with Boise Inc.," said Jeff Kellar, president of Hexacomb, "It capitalizes on people and product synergies, enabling Hexacomb to accelerate its strong growth trajectory and expand its customer relationships." Boise manufactures packaging products and papers including corrugated containers, containerboard, label and release and flexible packaging papers, imaging papers for the office and home, printing and converting papers, newsprint, and market pulp.