Newell Brands kicked off its restructuring plan on Friday, announcing it would sell its Waddington Group package manufacturing business to Novolex for $2.3 billion.
The sale is the first under Newell’s “accelerated transformation” strategy aimed at divesting non-core businesses that account for about 35% percent of its net sales. The end product would be a company focused on seven core consumer divisions.
Novolex, the world’s largest plastic bag maker, is owned by buyout firm Carlyle Group LP and, as Plastics News reports, has been on an acquisition spree since 2012, diversifying into paper bags, food-grade and retail packaging, can liners, and other products.
Waddington, which had 2017 net sales of $907 million, makes disposable food packaging for markets such as bakeries, delis and restaurants. It operates 16 factories and employs about 3,000 people at plants in the U.S., Canada, Ireland, the Netherlands, and the United Kingdom.
“This mutually beneficial deal allows the Waddington team to unlock its full potential under a new owner who is committed to the packaging category, and provides Newell Brands the opportunity to take an important first step forward in our Accelerated Transformation Plan,” Newell CEO Michael Polk said in a news release.
He said the plan would “make Newell Brands a simpler, stronger and faster company, best positioned to leverage our competitively advantaged capabilities in innovation, design and e-commerce.”
Other brands on Newell’s list to sell include Rubbermaid’s housewares and outdoor products, Goody hair brushes and combs, Process Solutions, Mapa, Spontex, Quickie cleaning brushes, Rawlings, and U.S. Playing Cards. On Friday, it added Jostens and Pure Fishing to the list.
Waddington’s portfolio includes Eco-Products, which makes food service items from renewable, compostable and post-consumer recycled materials; Polar Pak serving ware, drinkware and cutlery; and WNA upscale disposable plastic products.
Novolex was previously known as Hilex Poly, its unit that makes grocery T-shirt bags.
“Adding rigid plastic food packaging and an expanded range of sustainable packaging products have been key strategic priorities, and the Waddington Group has long been our top acquisition target,” Novolex CEO Stan Bikulege said.