Pactiv to buy Prairie Packaging for $1 billion
April 12, 2007 - Pactiv Corp. today said that it has agreed to acquire the stock of Prairie Packaging, a manufacturer of disposable tableware products, for $1 billion.
The purchase price represents about 7.0 times Prairie's projected 2007 EBITDA of $116 million, plus tax benefits related to the treatment of the transaction as an asset acquisition for tax purposes, Pactiv said.
Prairie's 2007 sales are expected to be approximately $500 million, Pactiv added.
Prairie manufactures a broad range of tableware and foodservice products, including drink cups, portion cups, containers, cutlery, plates, and bowls. The company operates five manufacturing facilities in the United States and employs approximately 1,200 people.
According to Pactiv, the North American plastic cup and cutlery market has approximately $3 billion in annual sales, with a projected growth rate of over 5 percent annually through 2010.
Pactiv expects the deal to close in the second quarter.
SOURCE: Pactiv Corp.