Quad will use proceeds from the divestment to reduce its debt
Graphic Packaging International has signed an agreement to acquire Omaha packaging plant from Quad/Graphics for around $40m.
Quad will use proceeds from the transaction to decrease its debt. The deal is expected to be completed by 31 January 2020.
Omaha plant’s high-volume and low-cost converting capabilities for folding cartons will complement vertically integrated supplier such as Graphic Packaging, which manages both paperboard mills and converting facilities.
The sale enables Quad to focus more on higher-value packaging solutions
Quad has divested Omaha packaging plant to concentrate more on higher-value packaging solutions, enabling clients to establish a cohesive brand experience across all channels ranging from consumer packaging to print, broadcast and digital advertising to in-store signage and displays.
Mesirow Financial’s Investment Banking Group acted as financial advisor to Quad on the transaction.
Quad chairman, president and CEO Joel Quadracci said: “We have a very talented, customer-focused team in Omaha, backed by excellent manufacturing capabilities, and we wish them well as part of the Graphic Packaging network.
“As part of our one-of-a-kind integrated marketing platform, our packaging solutions support speed-to-market through strategy and creative, structural design, package performance testing, prepress, printing and logistics, and more.”
Quad said that it continues to invest in and expand its core packaging platform, which includes plants in Franklin of Wisconsin, Spartanburg of South Carolina, Leominster of Massachusetts and Santo Domingo of Dominican Republic.
Last year, the firm extended packaging operations to the North-eastern US by re-installing its existing Leominster commercial printing plant. It serves different packaging clients in multiple market verticals.
In 2020, Quad intends to expand its packaging operations in the Dominican Republic with the addition of a 30,000ft² of space and new equipment such as two presses, die cutter and folder-gluer.
Graphic Packaging offers packaging solutions for the customers in the food, beverage, foodservice, and other consumer products companies.
In August 2019, Graphic Packaging approved a $600m investment in a new coated recycled board machine in the Midwest.