Clayton, Dubilier & Rice (CD&R) has announced an agreement that will see CD&R funds acquire and combine label solution providers Fort Dearborn and Multi-Color Corporation (MCC).
The funds are purchasing Fort Dearborn and MCC from private equity investors Advent International and Platinum Equity, respectively.
According to CD&R, the merger will create the world’s largest label solutions company, with projected annual revenue of approximately $3 billion.
Based in Ohio, US, MCC is a producer of pressure-sensitive, in-mould and heat transfer labels, as well as cut and stack, roll-fed, aluminium and shrink sleeve labels.
Last week, the company announced that it had agreed to acquire Hexagon Holdings, a New Zealand-based privately owned group of businesses manufacturing products including self-adhesive labels and shrink sleeves.
Meanwhile, Fort Dearborn supplies a range of label solutions to consumer goods companies and is headquartered in Illinois.
Following the merger, the combined company will serve customers in a variety of markets, including wine, spirits, beer and the wider beverage category, as well as food, and home and personal care.
David Scheible, operating advisor to CD&R funds and former chairman and CEO of Graphic Packaging, will serve as chairman of the combined company. Scheible currently serves on the Fort Dearborn board of directors.
“We see strong strategic logic and promising value creation potential in bringing these two leading label manufacturers together,” said Nate Sleeper, CD&R CEO.
“We see numerous opportunities to drive operational scale, achieve sustained growth, and we believe our expertise can help position the combined company for success well into the future.”
Kevin Kwilinski, president and CEO of Fort Dearborn, said: “We believe the growth opportunities that this combination and new investment partnership with CD&R present will greatly benefit our customers, suppliers and employees alike.
“We believe MCC’s global footprint and CD&R’s experience helping industrial companies enhance operational execution and achieve global scale and growth will benefit the combined enterprise.”
Robert Volpe, CD&R principal, added: “We believe that the combined company will have a scaled global platform across end categories and geographies, innovative label technologies, favourable growth prospects and a deep set of capabilities to serve customers all over the world.”
The acquisitions and merger are subject to customary closing conditions and are expected to be completed by the end of the year.
The financial terms of the transactions have not been disclosed.
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