:max_bytes(150000):strip_icc()/GettyImages-1391987730-bd50fe8c43154b4ebd942df51d761ab1.jpg "Bubble Wrap Maker Sealed Air Sold for .2 Billion, Here’s Who’s Taking Over")
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Key Takeaways
- Sealed Air agreed to a $6.2 billion buyout by private equity firm CD&R.
- The deal pays investors in the maker of bubble wrap $42.15 per share, below Friday’s closing price of $43.28.
Sealed Air (SEE) shares slid about 3% Monday afternoon, after the maker of bubble wrap agreed to be taken private by private equity firm CD&R in a $6.2 billion deal.
The Charlotte, N.C.-based company said the all-cash purchase would pay investors $42.15 per share, 2.6% below its closing price Friday. However, that was still some 16% above last Wednesday’s closing price of $36.38, before reports emerged that CD&R was near a deal.
Why This News Is Significant
Private equity firms have been active buyers in the packaging and industrials sector as companies face higher costs and uneven demand. Transactions like this one to take the companies private illustrate the trend of investors looking to restructure longtime manufacturers outside of public markets where they would face higher disclosure requirements and scrutiny.
Sealed Air Chair Henry Keizer said that after looking at strategic alternatives for the company over the past year, “the Board is confident that this transaction delivers significant value and is in the best interests of our stockholders and the Company.”
Under terms of the agreement, Sealed Air has the option to seek out other suitors in a “go-shop” period of 30 days after signing, with an additional 15 days to ink a definitive agreement with another party.
The transaction, with an enterprise value of $10.3 billion, is expected to close in the middle of next year.
Despite today’s decline, shares of Sealed Air are up about 24% year-to-date.
