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BASIC INDUSTRIES: Amcor (AMCR Baa2[N]/BBB/NR): Berry Global All-Share Merger

BASIC INDUSTRIES
USCredit BulletsCEEMEABulletUKNorth America
  • Packaging cos Amcor and Berry announce an all-share takeover agreement in a 63/37% split. They’re targeting a mid-2025 close.
  • Note the rating above applies to BERY € bonds which are 1st Lien.
  • There’s around 0.5x turns of leverage difference. AMCR FY leverage should rise from 2.9x to 3.3x. Synergies of $650mn by year 3 would see leverage tick down slightly on higher EBITDA, even without excess cash retained. Amcor expects to return to 3x by the first year.
  • Amcor affirmed its commitment to investment grade. Given leverage impact above and increased scale we would not expect any ratings impact.

  • BERY should converge towards AMCR’s curve.

     

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  • Packaging cos Amcor and Berry announce an all-share takeover agreement in a 63/37% split. They’re targeting a mid-2025 close.
  • Note the rating above applies to BERY € bonds which are 1st Lien.
  • There’s around 0.5x turns of leverage difference. AMCR FY leverage should rise from 2.9x to 3.3x. Synergies of $650mn by year 3 would see leverage tick down slightly on higher EBITDA, even without excess cash retained. Amcor expects to return to 3x by the first year.
  • Amcor affirmed its commitment to investment grade. Given leverage impact above and increased scale we would not expect any ratings impact.

  • BERY should converge towards AMCR’s curve.