What Amcor Limited’s latest acquisition means for shareholders

What: Leading global manufacturer of flexible packaging, folding cartons and rigid plastics Amcor Limited (ASX: AMC) has on Thursday morning announced the $41 million acquisition of Canadian-based Plastic Moulders Ltd.

So What: Plastic Moulders is a rigid plastics business that manufactures containers and closures for the food, home and personal care markets in North America.

The business operates out of a single plant in Toronto, Canada, and has annual sales of approximately $37 million.

Amongst the key positives of the Plastic Moulders acquisition is new technology which Amcor will be gaining access to. In-mould labelling technology will allow for “embedding the label into the container wall at the same time as the container is extruded, thus removing the need for any secondary processes to adhere a label to the container.”

Now What: Shares in the three major ASX-listed packaging companies, Amcor, Orora Ltd (ASX: ORA) and Pact Group Holdings Ltd (ASX: PGH) have achieved substantial outperformance in the past 12 months gaining 19%, 30% and 31% respectively.

In contrast, the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) is down 6%.

Today’s acquisition by Amcor is expected to deliver procurement, manufacturing and overhead synergies along with benefits to be garnered from new technological processes.

With packaging companies such as Amcor offering investors exposure to the fast moving consumer goods sector, it is a sector well worth keeping abreast of.

Why These 3 Blue Chip Shares Look Set to Soar in 2016

Discover The Motley Fool's top 3 blue chips for 2016. These 3 'new breed' shares pay fully franked dividends AND offer the very real prospect of significant capital appreciation. Simply click here to gain access to this comprehensive FREE investment report.

No credit card required.

Motley Fool contributor Tim McArthur has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

HOT OFF THE PRESSES: My #1 Dividend Pick for 2017!

With its shares up 155% in just the last five years, this ‘under the radar’ consumer favourite is both a hot growth stock AND our expert’s #1 dividend pick for 2017. Now we’re pulling back the curtain for you... And all you have to do to discover the name, code and a full analysis is enter your email below!

Simply enter your email now to receive your copy of our brand-new FREE report, “The Motley Fool’s Top Dividend Stock for 2017.”

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.