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Flexible Packaging: If A has bought B, what happens to C&D?

Amcor’s recent announcement of their agreement to purchase Bemis for $6.8B USD is the biggest news to hit the flexible package industry in years. It marks the coming together of 2 industry giants and is set to shake up the global industry. But what will the new company look like?

The new look Amcor/ Bemis, known as New Amcor, promises to be a beast. Just look at the numbers involved. The new company will have a combined turnover of $17B USD, over 250 plants and 50,000 employees across more than 40 countries. Bemis President and CEO said that the agreement will create ‘a global leader in consumer packaging’, and he’s certainly right as the move is made from competitor to collaborator.

Flexible packaging will make up an estimated $9B of the new business. New Amcor aims to be better than the sum of its parts, with better coverage of emerging markets than (Old?) Amcor and will maintain a presence in all current key Bemis locations. Bemis brings a much bigger presence in North and Latin America than Amcor currently has, and also brings some major clients from the food industry to the table.

What about C&D?

One company who will be paying particular attention to the news is Constantia Flexibles, or the ‘C’ to Amcor and Bemis’ A&B. Whilst the presumed disappearance of one of their competitors will bump them up the global rankings, it remains to be seen how the combined strength of New Amcor will impact their traditionally strong market position in Europe.

They recently announced their latest technological breakthrough in the pharma packaging space at Healthcare Packaging Expo, but they’ll now have a bigger fight on their hands than ever to stay ahead of the competition. Having spoken to a range of employees from Constantia, I know that they’re excited about the new challenge.

Another business that will be gearing up to compete with New Amcor and has undergone significant change of its own is Coveris. They sold off their Coveris Americas packaging business earlier this year for more than $1.7B to Transcontinental Inc. (which has understandably had an impact on their Q3 results) and also invested in their UK facility to increase their capacity, demonstrating their commitment to sustainable packaging.

Coveris look to have been trimming off non-key areas of their business and doubling down on their strengths – presumably to leave them as a leaner, more efficient competitor in their key markets.

Looking Forward

It remains to be seen what will happen for employees of New Amcor as no merger is ever 100% complimentary. The impact will hopefully be a positive one for the wider industry, although it remains to be seen exactly what will happen.

What do you think the acquisition means for the industry? Is it a cause for the industry to celebrate, or for employees of the new business and competitors to worry?

If you work in flexible packaging how are you and your business affected? Join in the conversation in the comments!

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