Sealed Air acquires bagging systems manufacturer for $510 million

Packaging solution provider Sealed Air Corp. said today it has acquired the automated bagging systems manufacturer Automated Packaging Systems Inc. (APS) for $510 million in a bid to keep up with e-commercedemands for automation, technical service, and sustainable packaging offerings.

The transaction is expected to close early in the third quarter of 2019, subject to applicable regulatory reviews and customary closing conditions.

Sealed Air is pleased to announce an agreement to acquire @autobag , a leading manufacturer of automated bagging systems, which will expand its automation and #sustainable packaging offerings. #acquisition https://t.co/yXT3ICNWjh pic.twitter.com/5bEZIzcjSu

— Sealed Air (@Sealed_Air) May 1, 2019

Streetsboro, Ohio-based APS provides flexible packaging systems, including Autobag bagging machines and pre-opened bags on a roll. The company generated $290 million in sales in 2018 and employs more than 1,200 people, with seven manufacturing sites in the U.S. and U.K.

"The addition of APS is well aligned with our Reinvent SEE goal of doubling our innovation rate over the next five years," Sealed Air President and CEO Ted Doheny said in a release. "This transaction expands the breadth of our automated solutions and sustainable packaging offerings, giving us access to growth opportunities in the markets we serve."

Charlotte, N.C.-based Sealed Air says the deal will also leads to benefits from cross-selling opportunities, enabling additional growth in "key markets." The company did not specify exactly which sectors those were, but also said the acquisition broadens its portfolio "to drive growth in [the] e-commerce, fulfillment, and food packaging markets."

In addition, Sealed Air "expects cost synergies resulting from supply chain efficiencies," which indicates the company likely expects to cut redundant assets after the deal closes.

The deal is Sealed Air's latest acquisition since its purchase of the packing supplies fabricator AFP Inc. in 2018 and its $100 million acquisition of Singapore-based polyethylene foam manufacturer Fagerdala Singapore Pte Ltd. in 2017.