The needle On This Packaging Giant Amcor

  • May 12, 2019 AEST
  • Team Kalkine
The needle On This Packaging Giant Amcor

Amcor Limited (ASX:AMC) develops and generates superior-quality packaging for food, personal-care products, beverage and so forth . The company generates, film packaging, specialty cartons folding cartons, plastic containers and caps to be used in packaging of various kind of food, beverages, sauces etc. The company is headquartered in Southbank, Australia and was founded in 1926.

On May 7 2019, the company announced significant progress being made towards closing the all-stock transaction along with Bemis Company, Inc., which is a NYSE-listed company. The all-stock transaction was announced last year, on 6 August 2018. The requisite clearances and consents, needed prior to the Second Court Hearing have been fulfilled, including shareholder approval and closing of the transaction. The antitrust approval in the United States is still awaited on it.

As announced on April 22 2019, the closing of the transaction is subject to the judgement of US Department of Justice (DOJ), which have not been finalised presently. Both companies, AMC and Bemis, are expecting the consent and approval to take place shortly, to facilitate further filings and proceedings.

On the Second Court Hearing, on 7 May 2019, AMC aimed towards presenting essential matters, related to the Scheme of Arrangement for the Court to consider. It also wanted to request the Court to postpone any formal orders until the pending and required DOJ consent along with filings have been finalised. Besides, the company is expecting to receive the formal orders once the DOJ process is fulfilled.

To accelerate the proceedings with DOJ and resolve the department’s concerns, Amcor had entered into a binding agreement with Tekni-Plex, Inc., for the sale of Amcor plants in Milwaukee, Ashland and part of the Madison plant. This was announced on 22 April 2019, which also stated the agreement to be for a cash consideration of USD 215 million.

On 2 May 2019, the company published Amcor and Bemis combination scheme meeting presentation. The company mentioned the purpose behind the scheme’s meeting, was for shareholders to consider and give their formal vote on the proposed acquisition of their shares in AMC by new Amcor, through way of scheme of arrangement.

In the presentation, AMC notified that it is confident in delivering substantial shareholder value. AMC’s shareholders would receive a New Amcor CDI or share for each existing share that they hold. The New Amcor would be both NYSE and ASX listed, with Amcor shareholders owning 71% and Bemis shareholders expected to own the remaining 29%. The Global Integration Management Office, drawn from both Amcor and Bemis was making significant progress.

Besides these updates, the company has also announced a pro-rata FY19 final dividend of 12.0 US cents per share, in order to cover the March 2019 quarter. After the Bemis transaction was completed, the company would declare its inaugural quarterly dividend for the June 2019 (as per an announcement made on 18 April 2019).

Earlier this year in February, the company presented its 2019 half-yearly results. The PAT and EPS were 3.4% higher than the previous year. PBIT was up 2.4%. The operating cash flow of USD 115 million soared up 27%. The interim dividend increased to 21.5 US cps.

Share Price Information:

On the technical front, the stock traded up by 0.187% and closed at A$16.060 as of 10 May 2019 compared to the previous closing of A$16.030. In the last six months, the stock has delivered a return of 17.44% while the YTD return stands a little better at 20.80%.


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