The Amcor Limited (ASX: AMC) share price has surged 15% so far this year as the packaging company has posted strong earnings and works towards a merger with Bemis Company Inc. (NYSE: BMS).
What is happening with Amcor and Bemis?
Bemis is a US-based packaging company which operates 57 packaging plants around the world largely based around food and consumer goods.
Amcor announced on 6 August 2018 that it would be purchasing Bemis in an 5.1-for-1 all-stock acquisition which is expected to close in 2Q 2019. Amcor shareholders will own ~71% of the new combined entity with Bemis shareholders making up the remaining 29% of ownership.
Amcor recently announced that its registration statement of Form S-4 has been declared effective by the Securities and Exchange Commission (SEC) in the US to acquire Bemis which follows a similar approval from the European regulators for the transaction.
Under the proposed merger, Amcor will establish a primary listing on the New York Stock Exchange (NYSE) as well as a listing on the ASX.
Is Amcor in the buy basket?
The Amcor share price has rocketed higher so far this year and hit a 52-week high of $15.39 per share during yesterday's trade.
The packaging company's share price has outperformed fellow ASX packaging group Orora Ltd (ASX: ORA) and Pact Group Holdings Ltd (ASX: PGH) which are both in the red so far this year.
The proposed Bemis merger is expected to be voted on in May 2019 and I'd expect to see some more share price volatility for Amcor in the lead-up to the vote. The proposed merger aside, I'm not particularly bullish on the packaging sector in Australia as a solid long-term growth play.
Rather than take a punt on a merger, I'd be looking at some of the top growth stocks including Afterpay Touch Group Ltd (ASX: APT) or Altium Ltd (ASX: ALU) which have surged higher so far this year.
For investors who are willing to roll the dice and venture into new industries, this top-rated cannabis stock is in the buy zone and could be set to surge higher in 2019.
