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.
