(Bloomberg) -- The market hasn’t yet recognized the value that will be created by packaging company Amcor Plc’s $8.4 billion takeover agreement last month for Berry Global Group Inc., Ancora said at the Bloomberg Activism Forum 2024.
Amcor’s share price could eventually rise to about $16 thanks to the deal, representing an upside of 50% to 70% from its current price of about $10, said Jim Chadwick, president of Ancora Alternatives LLC during a presentation. Much of that will be driven by at least $650 million in potential synergies from the deal — a conservative estimate, of the cost-savings to be realized, Chadwick said.
Activist investor Ancora, which has amassed a stake of more than $100 million in Berry since 2021, has urged the company to explore a sale, according to a letter at the time. Amcor announced the deal to acquire Berry last month.
The packaging industry has seen a furry of deals in recent months, including this week’s combination of Apollo Global Management Inc.-owned Novolex with rival Pactiv Evergreen Inc. as well as International Paper Co.’s move to buy DS Smith Plc.
A representative for Amcor declined to comment. A representative for Berry didn’t immediately respond to requests for comment.
Berry reached a cooperation agreement with Ancora and another activist investor Eminence Capital in 2022 alongside the appointment of three new board directors at the time. The company also set up a capital allocation committee and later spun off its health and hygiene business before the tie-up with Amcor.
(Updates with Amcor representative declining to comment in penultimate paragraph.)
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