Leading Canadian thermoformer Shepherd Thermoforming and Packaging is being acquired by Good Natured Products Inc., a producer and distributer of products featuring renewable and plant-based packaging.
The purchase is C$9.5 million (US$7.2 million) and is slated to close by April 30.
In a March 4 conference call, Good Natured CEO Paul Antoniadis said the acquisition fosters "substantial synergy" for both companies.
"This acquisition will help Good Natured to become the leading earth-friendly product company in North America," he said.
Brampton, Ontario-based Shepherd has been thermoforming products for more than 35 years and has 50-75 customers, including several Fortune 500 companies in Eastern Canada and the Northeastern U.S., Antoniadis said. Its customers include brand names such as Advil, Colgate, Playtex, Malibu, Ferrero Rocher, Brita and Lindt, among others.
"It enables production capacity in Canada and U.S. and adds a projected C$5.5 million (US$4.1 million) of annual sales," he said.
Good Natured will add Shepherd's 42,000-square-foot facility in the Toronto suburb of Brampton. This includes six thermoforming machines and two computer numerically controlled trimming machines at its fully integrated design, mold making, testing and manufacturing facility, said Don Holstrom, chief financial officer of Good Natured.
"Good Natured has a leading family of products. Shepherd has a number of molds that will complement existing lines," Holstrom said. "We believe there are significant opportunities to bring over 250 product assortments to existing Shepherd customers, creating organic growth."
Shepherd Thermoforming has been a family-owned and -operated business since it began in 1984. The company offers custom thermoforming and vacuum forming, including food-grade packaging.
"We're delighted to welcome Mark and Todd Shepherd and the entire Shepherd team to the Good Natured family," Antoniadis said. "We share a common vision to be leaders in the development and adoption of sustainable, planet-friendly packaging solutions in North America, so the combination of our collective expertise, people and manufacturing capability further positions the Company to execute against this ambition."
Good Natured offers a range of plant-based, biodegradable or recyclable packaging for a variety of markets, including food packaging, home and office items.
"If the brand or company sells petroleum-based products, we intend to convert them to a range of plant-based materials," Antoniadis said.
Recent fears over the coronavirus were also addressed during the call.
"We anticipate zero impact," he said. "With the reduction of the rates that were announced in the U.S. and Canada, it'll likely be a positive impact for us in our overall business."