Loews, packaging, cardboard

Loews Corp. is adding plastic packaging manufacturer Consolidated Container Co. to its already diverse portfolio.

The $1.2 billion acquisition of Consolidated, which was announced Tuesday, is Loew’s first foray into the packaging industry. The conglomerate’s other businesses include hotels, energy and financial services.

Loew’s CEO James Tisch said the packaging industry “fits our key acquisition criteria: It is a fragmented industry that generates strong cash flows and we believe it is unlikely to be subject to major technological disruption.”

Atlanta-based Consolidated, which provides packaging solutions to customers including Colgate-Palmolive, Procter & Gamble, and Dean Foods, will become a part of a newly created segment called Loews Packaging Group. It is currently owned by Bain Capital Private Equity.

“I have every confidence that Loews will be an excellent partner for CCC as we continue to invest in differentiated capabilities to best serve our customers,” Consolidated’s chief executive, Sean R. Fallmann, said in a news release. “It remains our mission to be the packaging solutions provider of choice in North America.”

The deal is expected to close in the second quarter of 2017, and will be funded with approximately 50% percent cash on hand and 50% debt.

Consolidated also operates Envision Plastics, a recycler of high-density polyethylene, and its network includes 57 rigid plastic packaging manufacturing facilities, two recycled resins manufacturing facilities, and 2,300 employees. Bain bought the company from Vestar Capital Partners in 2012 in a deal that valued it at about $800 million.

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