MeadWestvaco Corp (MWV) said the sell-off of its office products division will add US$460m into its coffers and allow it to focus on its packaging businesses.
The US-based company announced that at least part of the windfall from the divestment of the office and consumer unit would be used to underpin its strategy to boost its global packaging operations.
“We see significant opportunities around the world in packaging,” said John A. Luke, Jr, chairman and CEO.
Luke hailed the sale as a great deal for the company and its shareholders, while declaring: “And, at the same time, we are taking a significant step in transforming MWV's business to focus on and grow in our targeted global packaging markets."
MWV supplies packaging to the bakery, chilled and frozen food sectors. It also manufactures packaging for the beverage and personal care markets, as well as food service, healthcare and tobacco.
The company chief said it would be looking to make acquisitions in emerging markets such as Brazil. New assets would likely be smaller outfits that could begin making positive cash contribution in a short time.
MWV also spelled out what the sale of its consumer and office products business would mean.
The ‘spin-merge’ transaction would see the unit spun off as a new entity and then immediately merged into ACCO Brands. At closing, MWV shareholders would receive 50.5% of the shares of ACCO Brands stock and MWV would pocket cash totalling $460m.