Transcontinental Inc. enters flexible packaging market
Montreal, March 11, 2014 – Transcontinental Inc. (TSX : TCL.A TCL. B TCL.PR.D) announced today that it entered into a definitive agreement under which it agreed to acquire the assets of Capri Packaging, a supplier of printed flexible packaging, located in Clinton, Missouri, for a purchase price of US$133 million. The transaction is subject to regulatory approval in the United States. Capri Packaging is a division of Schreiber Foods, Inc., a US$5 billion employee-owned dairy company, located in Green Bay, Wisconsin.
TC Transcontinental will be acquiring two facilities in Clinton, Missouri, which employ close to 200 people, and generate approximately US$72 million in annual revenues. As part of the transaction, the seller, Schreiber Foods, Inc. has signed a 10-year agreement to secure Capri Packaging as a strategic supplier of printed flexible packaging, which represents about 75% of Capri's total revenues.
"This acquisition represents an important strategic move for the Corporation into a new promising growth area. It is part of our strategy to ensure our future growth path through diversification. Over the past year we evaluated various industries where we could leverage our manufacturing competency, a great success for us in the past. The printed flexible packaging industry was rapidly identified as a natural fit given that the production process is very similar to TC Transcontinental's printing operations and the market offers many opportunities for growth. We are very excited to partner with Schreiber Foods Inc. for the long term, which will provide us with a recurring revenue stream, and look forward to fostering our relationship over the coming years," said François Olivier, President and Chief Executive Officer of Transcontinental Inc.
"We are very pleased to enter into a long-term supply agreement with TC Transcontinental. They are an exceptional company that brings world-class printing capabilities, dynamic leadership and decades of experience to the table. And most importantly, TC Transcontinental shares many of the same values and qualities that are core to Schreiber. We look forward to working closely with TC Transcontinental in the months ahead to ensure a smooth transition, while setting the foundation for a long-lasting friendship and partnership," said Mike Haddad, President and Chief Executive Officer of Schreiber Foods, Inc.
Additional Information
Annual General Meeting of Shareholders
As a reminder, Transcontinental Inc. is holding its Annual General Meeting today at 9:30am at the Centre Mont-Royal located at 2200 Mansfield Street, Montreal.
Conference Call
The Corporation will hold a conference call for the financial community today at 2:00 p.m to discuss its first quarter results as well as this acquisition. The dial-in numbers are 1 416 642-5212 or 1 866-321-6651 and the access code is 8339872. Media may hear the call in listen-only mode or tune in to the simultaneous audio broadcast on the Corporation's Web site, which will then be archived for 30 days. For media requests for information or interviews, please contact Nathalie St-Jean, Senior Advisor, Corporate Communications of TC Transcontinental, at 514 954-3581.
About TC Transcontinental
Largest printer and leading provider of media and marketing activation solutions in Canada, TC Transcontinental creates products and services that allow businesses to attract, reach and retain their target customers. The Corporation specializes in print and digital media, the production of magazines, newspapers, books and custom content, mass and personalized marketing, interactive and mobile applications, and door-to-door distribution.
Transcontinental Inc. (TSX: TCL.A, TCL.B, TCL.PR.D), including TC Transcontinental, TC Media and TC Transcontinental Printing, has over 9,000 employees in Canada and the United States, and revenues of C$2.1 billion in 2013. Website www.tc.tc.
About Schreiber Foods, Inc.
Headquartered in Green Bay, Wis., Schreiber is the largest employee-owned dairy company in the world, with annual sales of more than US$5 billion. Schreiber sells its products – which include cream cheese, natural cheese, process cheese and yogurt – to leading retailers, restaurants, distributors and food manufacturers around the world. Schreiber has more than 30 manufacturing and distribution facilities globally in the United States, Austria, Brazil, Bulgaria, Czech Republic, Germany, India, Mexico, Portugal and Uruguay.
Forward-looking Statements
Our public communications often contain oral or written forward-looking statements which are based on the expectations of management and inherently subject to a certain number of risks and uncertainties, known and unknown. By their very nature, forward-looking statements are derived from both general and specific assumptions. The Corporation cautions against undue reliance on such statements since actual results or events may differ materially from the expectations expressed or implied in them. Forward-looking statements may include observations concerning the Corporation's objectives, strategy, anticipated financial results and business outlook. The Corporation's future performance may also be affected by a number of factors, many of which are beyond the Corporation's will or control. These factors include, but are not limited to, the economic situation in the world and particularly in Canada and the United States, structural changes in the industries in which the Corporation operates, the exchange rate, availability of capital, energy costs, competition, as well as the Corporation's capacity to engage in strategic transactions and integrate acquisitions into its activities. The main risks, uncertainties and factors that could influence actual results are described in Management's Discussion and Analysis (MD&A) for the fiscal year ended on October 31st, 2013, in the latest Annual Information Form and have been updated in the MD&A for the first quarter ended January 31st, 2014.
Unless otherwise indicated by the Corporation, forward-looking statements do not take into account the potential impact of nonrecurring or other unusual items, nor of divestitures, business combinations, mergers or acquisitions which may be announced after the date of March 10, 2014.
The forward-looking statements in this press release are made pursuant to the "safe harbour" provisions of applicable Canadian securities legislation.
The forward-looking statements in this release are based on current expectations and information available as at March 10, 2014. Such forward-looking information may also be found in other documents filed with Canadian securities regulators or in other communications. The Corporation's management disclaims any intention or obligation to update or revise these statements unless otherwise required by the securities authorities.
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Photos available here: Capri Packaging
For information:
Media
Nathalie St-Jean
Senior Advisor, Corporate Communications
TC Transcontinental
Telephone: 514 954-3581
nathalie.st-jean@tc.tc
Financial Community
Jennifer F. McCaughey
Senior Director, Investor Relations and External Corporate Communications
TC Transcontinental
Telephone: 514 954-2821
jennifer.mccaughey@tc.tc
