TC Transcontinental selling its paper and woven PP operations to Hood Packaging
Burlington, Ont.-base Hood will acquire TC’s operations in the U.S. states of California, Iowa, Pennsylvania, South Carolina, and Georgia.
Montreal-based TC Transcontinental is selling its paper and woven polypropylene (PP) packaging operations to Hood Packaging Corp., of Burlington, Ont., for about $239 million.
Under the deal, Hood Packaging will acquire paper packaging operations and buildings in California, Iowa, Pennsylvania, and Georgia. In addition, Hood Packaging is acquiring the paper and woven PP packaging operations at the Transcontinental Spartanburg, South Carolina plant; TC Transcontinental will retain ownership of this building and continue operating from this location, which also manufactures plastic flexible packaging.
About 415 employees are expected to transfer to Hood Packaging once the deal closes.
The transaction is subject to regulatory approvals and is expected to close in the first quarter of TC Transcontinental’s 2020 financial year.
Hood Packaging manufactures plastic film and bags, woven polypropylene bags, coated and laminated materials, and paper packaging. In addition to its Burlington location, the company has an office in Madison, Mississippi. Hood Packaging employs almost 2,000 employees and is a wholly owned subsidiary of Hood Companies Inc.
“When we acquired Coveris Americas, we welcomed all of their assets and broad portfolio of products,” said TC Transcontinental president and CEO François Olivier said in a Nov. 27 statement. “After operating the paper business for almost 18 months, we concluded that it is less core to our packaging sector’s growth strategy. As such, our decision to sell these assets is aligned with our plan to continue building our flexible packaging platform where we see good growth potential. In addition, this transaction will enable us to deleverage our balance sheet faster than expected and give us the flexibility to continue acquiring businesses that are more complementary to our existing flexible packaging portfolio.”