Packaging Corporation of America (PCA) has entered into a definitive agreement to acquire substantially all of the assets of Sacramento Container Corporation, and 100% of the membership interests of Northern Sheets, LLC and Central California Sheets, LLC in a cash-free, debt-free transaction for a cash purchase price of $265 million.

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Packaging Corporation of America to acquire Sacramento Container Corporation

Packaging Corporation of America (PCA) has entered into a definitive agreement to acquire substantially all of the assets of Sacramento Container Corporation, and 100% of the membership interests of Northern Sheets, LLC and Central California Sheets, LLC in a cash-free, debt-free transaction for a cash purchase price of $265 million. PCA plans to finance the transaction with available cash on hand, as the company says in the press release received by Lesprom Network.

The acquisition transaction is structured as a purchase of assets resulting in a full step-up of the assets to fair market value. Under the terms of the agreement, PCA will acquire full-line corrugated products and sheet feeder operations in McClellan, California and Kingsburg, California.

PCA Executive Vice President Tom Hassfurther said, “The acquisition of these well-capitalized facilities will further enhance our operations both geographically and strategically. Also, the customer-focused employees and strong management teams of Sacramento Container, Northern Sheets and Central California Sheets will be an excellent fit with PCA’s culture. This group has built a successful business based on providing outstanding quality and service to a wide array of customers located in the northern and central regions of California.”

Closing is subject to certain customary conditions and regulatory approval and is expected early in the 4Q 2017.

PCA is the fourth largest producer of containerboard and corrugated packaging products and the third largest producer of uncoated freesheet paper in the United States.