The US Department of Justice (DOJ) has approved the $6.8bn (£5.3bn) proposed merger of packaging firms Amcor and Bemis.
Image: Amcor and Bemis supply rigid and flexible packaging products. Photo: Image by Foundry Co from Pixabay.
The department said that Amcor is required to divest three manufacturing facilities and other assets to proceed with the acquisition of Bemis.
In a statement, the department said: “Without the divestiture, the proposed acquisition would eliminate competition between two of only three significant suppliers of three medical packaging products that are critical to the safe transportation and use of medical devices.”
The two firms plan to close the transaction on 11 June 2019, as all antitrust and other regulatory clearances have been received.
Amcor agreed to sell its three manufacturing facilities units to Tekni-Plex in April 2019 in a deal valued at around $215m.
Amcor disposed certain assets to resolve specific antitrust concerns raised in the US associated with the proposed merger of Amcor and Bemis.
In August 2018, Amcor agreed to buy Bemis in an all-stock transaction worth $6.8bn. Under the terms of the deal, Amcor shareholders will own 71% stake in the combined company, while the remaining 29% interest will be owned by the Bemis shareholders.
The combined firm is expected to play a crucial role in the consumer packaging segment, in addition to providing significant value for shareholders, customers and employees, the firms said.
Additionally, the combined firm will have increased exposure to major end markets and product segments, including protein and healthcare packaging, barrier films and foils.
Commenting on the deal, Amcor CEO Ron Delia earlier said: “The strategic rationale for this combination and the financial benefits are highly compelling for both Amcor and Bemis shareholders.”
Earlier this year, the European Commission (EC) has approved the proposed merger of Amcor and Bemis, subject to conditions that Bemis should sell its medical packaging business in Europe.
Amcor and Bemis supply a range of rigid and flexible packaging products for customers in multiple sectors.
US-based Bemis is involved in the distribution of rigid and flexible packaging products to customers in the food, consumer, medical, pharmaceutical and other industries.
Australia-based Amcor supplies a range of rigid and flexible packaging products to customers in the food, beverage, medical, pharmaceutical, personal care and other consumer goods sectors.