Press Release: AMCOR AND BERRY TO COMBINE IN AN ALL-STOCK TRANSACTION, CREATING A GLOBAL LEADER IN CONSUMER AND HEALTHCARE PACKAGING SOLUTIONS

AMCOR AND BERRY TO COMBINE IN AN ALL-STOCK TRANSACTION, CREATING A GLOBAL LEADER IN CONSUMER AND HEALTHCARE PACKAGING SOLUTIONS

PR Newswire

ZURICH and EVANSVILLE, Ind., Nov. 19, 2024

Combination of Complementary Businesses Expands Product Offering and Capabilities to Support Higher Growth for Customers

Combined R&D and Innovation Investment Accelerates Development of Sustainable Packaging Solutions and Delivers Greater Choice for Customers and Consumers

$650 Million Annual Earnings Synergies Benefit

Over 35% Adjusted Cash EPS Accretion

Companies to Host Investor Conference Call Today at 8:00am U.S. Eastern Time

ZURICH and EVANSVILLE, Ind., Nov. 19, 2024 /PRNewswire/ -- Amcor plc ("Amcor") (NYSE: AMCR; ASX: AMC) and Berry Global Group, Inc. ("Berry") $(BERY)$, today announced they have entered into a definitive merger agreement, pursuant to which Amcor and Berry will combine in an all-stock transaction.

Berry shareholders will receive a fixed exchange ratio of 7.25 Amcor shares for each Berry share held upon closing, resulting in Amcor and Berry shareholders owning approximately 63% and 37% of the combined company, respectively. The transaction has received unanimous approval of the boards of directors of both Amcor and Berry and values Berry's common stock at $73.59 per share.

The combination brings together two highly complementary businesses to create a global leader in consumer packaging solutions, with a broader flexible film and converted film offering for customers, a scaled containers and closures business and a unique global healthcare portfolio. The combined company will have unprecedented innovation capabilities and scale, and be uniquely positioned to accelerate growth, solve customers' and consumers' sustainability needs, unlock portfolio transformation and deliver significant value to both sets of shareholders.

Amcor CEO, Peter Konieczny, said, "This combination delivers on our strategy to accelerate growth by putting the customer first, elevating the role of sustainability and orienting the portfolio toward faster growing, higher margin categories. We will have a more complete and more sustainable product offering, supported by stronger innovation capabilities, global scale and supply chain flexibility. We will help global and local customers grow faster and operate more efficiently with a team of exceptional talent. As a result, this combination also drives a step change in annual free cash flow, earnings growth and value creation for our shareholders. I, and the Amcor team, look forward to joining with Berry to accelerate change and real impact for our customers and their consumers."

Berry CEO, Kevin Kwilinski, added, "Over the past year, Berry has undergone a significant transformation, completing the spin-off of our HHNF business, enhancing our product mix and optimizing our portfolio. Our combination with Amcor is a logical next step in our company's evolution, and it is a testament to our entire team that we're well positioned to build on this momentum and deliver even more value to our shareholders. We expect to better serve customers through a comprehensive and innovative consumer packaging portfolio and a complementary geographic coverage. Importantly Berry and Amcor have aligned philosophies focused on safety, employee experience, sustainability, innovation, customer intimacy, and functional excellence. We will be better together, and I look forward to all we will achieve as a combined organization."

Compelling Strategic Benefits:

   -- Stronger business, strategically focused on high-growth, high-margin 
      categories with greater capabilities and a more complete product offering 
      for customers 
 
          -- Creates a global product offering in flexibles, containers and 
             closures by combining Amcor's global flexibles and regional 
             containers businesses with Berry's regional flexibles and global 
             containers and closures businesses 
 
          -- Combines two highly attractive and complementary global healthcare 
             businesses 
 
          -- Strengthens positions in high-growth, high-value categories, 
             including Healthcare, Protein, Pet Food, Liquids, Beauty & 
             Personal Care, and Food Service 
 
          -- Brings together complementary innovation capabilities and 
             platforms, material science expertise and specialized tooling, 
             design and multi-component assembly capabilities 
 
   -- Creates the innovation partner of choice developing the most sustainable 
      packaging solutions 
 
          -- Offers customers a wider range of more sustainable solutions which 
             drive circularity, increase use of alternative materials and lower 
             carbon footprint 
 
          -- Delivers greater choice for customers and consumers with a 
             portfolio of unique flexible, container and closure solutions 
             developed using a broader range of recycled materials, next 
             generation lightweighting technologies, reuse and recycle ready 
             capabilities and differentiated high barrier paper based formats 
 
          -- Establishes technology driven innovation leader with more 
             capabilities and significantly higher capacity to invest in 
             solving technical challenges with combined R&D investment of $180 
             million per annum, 1,500 R&D professionals, 10 innovation centers 
             worldwide and 7,000+ patents, registered designs, and trademarks 
 
          -- Enhances capabilities by leveraging corporate venturing 
             partnerships to access new and groundbreaking sustainability 
             solutions (substrates, barrier, fiber and recycling), digital 
             solutions and disruptive ideas in adjacent businesses and 
             technologies 
 
   -- Scale and reach provide local expertise, global capabilities and supply 
      chain resilience 
 
          -- Optimizes footprint servicing customers in 140+ countries through 
             400 production facilities, brings global capabilities to local 
             customers and provides local access and expertise to global brands 
 
          -- Supports customers in accessing broader growth opportunities and 
             addressing specific regional needs with a balanced geographic 
             presence across continents including in high-growth emerging 
             markets 
 
          -- Enhances scale and reach that ensure supply chain resilience in a 
             dynamic world and access to global manufacturing best practices 

Compelling Financial Benefits:

   -- Strong combined financial profile 
 
          -- Combined revenues of $24 billion and adjusted EBITDA of $4.3 
             billion, including run-rate synergies 
 
          -- Combined revenue growth above market, accelerating by at least 1% 
 
          -- Strong combined annual cash flow1 of over $3 billion, providing 
             significant capacity to fund organic reinvestment, a compelling 
             dividend, value accretive M&A and share repurchases 
 
          -- Expected net leverage of 3.3x at close with path to de-lever below 
             3.0x within first full year 
 
          -- Commitment to investment grade balance sheet and continued annual 
             dividend growth from Amcor's current annualized base of $0.51 
             cents per share. Berry expects to maintain its current dividend 
             policy until the close of the transaction 
 
          -- Unlocks further opportunities to refine portfolio, enhancing focus 
             on high-growth, high-margin categories and releasing capital to 
             drive further growth 
 
   -- $650 million benefit from identified cost, growth and financial synergies 
      by end of third year 
 
          -- $530 million annual run-rate pre-tax cost synergies 
 
          -- $60 million in annual run-rate financial savings 
 
          -- $60 million annual run-rate pre-tax earnings benefit from growth 
             synergies, including from: 
 
                 -- Increased exposure to higher growth, higher value 
                    categories including Healthcare, Protein, Liquids, Pet Food, 
                    Beauty & Personal Care and Food Service 
 
                 -- Combined innovation capabilities to better serve customers 
                    and unlock growth opportunities 
 
                 -- Differentiated commercial capabilities deployed across a 
                    broader platform 
 
          -- Additional $280 million of one-time cash benefits from working 
             capital efficiencies offsetting approximately $280 million of 
             expected pre-tax costs to achieve synergies 
 
   -- Significant value creation for all shareholders 
 
          -- Over 35% adjusted cash EPS accretion and expected double-digit 
             return on investment2 
 
          -- Enhanced long-term shareholder value creation through sustained 
             higher expected earnings growth from 10-15% to 13-18% per annum 

Timing and Approvals

The transaction has been unanimously approved by the boards of directors of both Amcor and Berry. Closing is targeted in the middle of calendar year 2025. The closing of the transaction is subject to shareholder approvals, regulatory approvals, and satisfaction of other customary closing conditions.

Board, Management, and Head Office

Peter Konieczny will serve as Chief Executive Officer, Graeme Liebelt will serve as Chairman and Stephen Sterrett will serve as Deputy Chairman of the combined company.

Amcor will maintain its primary listing on the NYSE and its secondary listing on the ASX. The combined entity will be named Amcor plc.

Global Head Office will remain in Zurich, Switzerland. The combined company expects to maintain a significant presence in Evansville, Indiana.

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