Avery Dennison to acquire Paxar Corp. for $1.34 billion

Avery Dennison Corp., a provider of web-enabled brand management retail and supply chain products, is acquiring Paxar Corp. in a cash transaction valued at about $1.34 billion, the two companies announced today. Under the agreement, Avery Dennison will buy all outstanding shares of Paxar for $30.50 per share.

The transaction is expected to enhance Avery Dennison’s ability to compare and grow in the fragmented, $15 billion-plus global retail information and brand identification market. The combined company will serve customers in Europe, Latin America, the Middle East and Asia.

“This combination is a terrific strategic fit,” says Dean A. Scarborough, president and CEO of Avery Dennison. “Paxar’s highly complementary services capabilities advance our strategy to deliver exceptional products and superior advice to customers at every level of the global retail supply chain, and to increase efficiency and reduce costs in a rapidly changing and increasingly competitive global marketplace. In addition, this acquisition will allow us to invest in product innovation and services that will serve our existing customers even better.”

Avery Dennison’s Retail Information Services business, one of its fastest growing units, provides brand identification and supply chain management solutions primarily for manufacturers and retailers, including tag and label design and printing; inventory and shipment tracking; and data management systems.

Paxar provides identification solutions to the retail and apparel industry worldwide.

Avery Dennison expects approximately $90 million to $100 million in annual cost savings, with similar infrastructure enabling the elimination of redundant production costs and reductions in selling, general and administrative expenses, including corporate overhead and back office support.