TC Transcontinental has divested its industrial packaging operations to Hood Packaging in a deal valued at approximately $95m, subject to working capital adjustments.
The operations included in the transaction generated revenues of approximately $50m in the 12 months ending 28 July 2024.
TC Transcontinental expects to use the net proceeds from this sale to further reduce its net debt.
This is anticipated to enhance financial flexibility for strategic acquisitions aimed at growth.
TC Transcontinental president and CEO Thomas Morin said: “Industrial packaging is a solid business. However, after operating it for several years, we concluded that it offers few synergies with the rest of our portfolio, and is not core to our Packaging Sector’s growth strategy.
“We are pleased for our employees that Hood Packaging, a family-controlled company like TC Transcontinental whose industrial packaging business is core to their activities, is the buyer.”
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The sale includes the company’s Thomasville, US, packaging operations and building, with 138 employees transitioning to Hood Packaging.
In addition, Hood Packaging will acquire the industrial packaging segment of TC Transcontinental’s Ontario, California, plant, which accounts for approximately 15% of that plant’s revenues.
TC Transcontinental Packaging Consumer & Beverage senior vice-president Roop Nangia said: “We sincerely thank all of our talented employees for their contribution, commitment and performance.”
TC Transcontinental is one of the major players in flexible packaging in North America and retail services in Canada.
With roughly 7,600 employees primarily located in Canada, the US, and Central America, TC Transcontinental reported revenues of $2.9bn for the fiscal year ending 29 October 2023.
