Apollo Global Management-owned packaging company Novolex has signed a definitive agreement with Pactiv Evergreen to merge into a combined entity in an all-cash deal valued at $6.7bn.
Expected to finalise in mid-2025, the merger will position the entity in the food, beverage, and speciality packaging industry. Novolex chair and CEO Stan Bikulege will lead the combined entity.
Bikulege said: “This transaction reflects the continuation of our long-term growth strategy to create the industry’s most innovative, sustainable and customer-focused company.”
The merger has the financial backing of Apollo Funds and CPP Investments, contributing approximately $1bn and securing a minority stake post-merger.
Under the agreement, Pactiv Evergreen shareholders will receive $18 per share in cash. The offer represents a 49% premium over the two-month average trading price before speculation of the deal surfaced on 2 December.
Upon completion, Pactiv Evergreen will transition to a privately held company, and its shares will be delisted from the Nasdaq stock market.
The Pactiv Evergreen board of directors has approved the transaction, with regulatory approvals and customary closing conditions pending.
Packaging Finance, as the majority shareholder of Pactiv Evergreen, has also given its approval, negating the need for further shareholder consent.
Apollo partners Rob Seminara and Peter Sinensky said: “Novolex and Pactiv Evergreen serve attractive end markets, and both companies have made tremendous progress in recent years to enhance their operations and strengthen their focus on product innovation and sustainability leadership.
“As the packaging industry continues to evolve, bringing together these two talented teams will better position the combined company with enhanced and complementary capabilities to meet shifting consumer demands and provide the highest quality products and services to customers. We’re proud to support Novolex and Pactiv Evergreen and look forward to our continued partnership with Stan and the management team as they drive innovation and sustainable growth.”
Morgan Stanley & Co. and RBC Capital Markets are also advising Novolex, with financing from Wells Fargo Bank NA, UBS Investment Bank, Barclays Bank, and Morgan Stanley Senior Funding.
Goldman Sachs & Co. and Lazard Frères & Co. are financial advisors to Pactiv Evergreen, with Paul Hastings as legal advisor.
