Sonoco Products Co. will sell its thermoforming and flexible packaging business to Japan-based Toppan Holding Co. in a $1.8 billion deal that will see it mostly exit plastic packaging.
The sale, announced Dec. 18, comes two weeks after Hartsville, S.C.-based Sonoco completed its acquisition of European cans, ends and closures maker Eviosys.
Sonoco 's thermoforming and film packaging business (TFP) saw global sales of about $1.3 billion in 2023, Toppan said in its announcement. In North America, Sonoco is at No. 5 among thermoforming companies in Plastics News rankings with $700 million in sales in the region. Sonoco is tied with D&W Fine Pack LLC of Wood Dale, Ill., for that fifth spot. It was No. 16 among film and sheet makers in North America in PN rankings.
Sonoco is a multinational company producing a wide range of consumer packaging, industrial products, protective packaging and healthcare. Total annual sales were $6.8 billion. The company uses paper, metal and plastics to make new products. It also has a recycling division that handles nearly 3 million tons of material each year, including paper, metal and plastics.
"The decision to sell our TFP business accelerates our portfolio simplification strategy, streamlines our organizational structure and enables more focused capital investments in our remaining industrial paper and consumer packaging businesses," Sonoco President and CEO Howard Coker said in a news release. "… We will work closely with Toppan to ensure a successful transition for our employees, customers, and suppliers and wish the entire team all the best in the future."
Toppan, a Tokyo-based maker of film and flexible packaging, calls Sonoco's operations as highly complementary" to its existing global operations. That includes a barrier film plant in Griffin, Ga., it opened in 2016.
"In order to accelerate our strategy to become a global leader in sustainable packaging solutions, we will employ the complementary strengths of both parties to drive growth, solve customers' needs and create significant value for our shareholders," Toppan Holdings President and CEO Hideharu Maro said in a release. "This is an essential milestone in the Toppan Group's global strategy to scale the sustainable packaging business."
The sale doesn't come as a complete surprise. Sonoco said in September that it had begun a "strategic review" of the TFP business to instead focus on "fewer bigger businesses."
It does mark, though, a continuing burst of merger and acquisition activity for rigid packaging that began Nov. 19 when Amcor plc said it would buy Berry Global Group Inc. for $8.43 billion. Then Dec. 9, Novolex Holdings said it was buying fellow plastic packaging maker Pactiv Evergreen Inc. in a $6.7 billion deal.
That means that three of the top five companies in PN's ranking of thermoformers are currently in the process of changing hands.