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Avery Dennison Corporation has completed its acquisition of Paxar Corporation, following the approval of the transaction by Paxars shareholders at its Annual Meeting on June 14, 2007.
This acquisition will strengthen a dynamic and important part of our business, said Dean Scarborough, president and chief executive officer of Avery Dennison. The combination with Paxar expands our presence in the growing retail and brand identification market, enabling us to provide better products and services to our customers and allowing us to more quickly tap into new segments of the market including retailers serving local customers in emerging markets such as China and India.
On March 22, 2007, Avery Dennison announced a definitive agreement to acquire Paxar for $30.50 per share in a cash transaction valued at approximately $1.34 billion.
With the acquisition of Paxar, Avery Dennisons Retail Information Services (RIS) business is expected to represent about 24 percent of Avery Dennisons revenues - up from 12 percent before the combination. Paxar reported sales last year of $881 million. Avery Dennison said it will provide additional information on the anticipated financial benefits of the transaction, including expected sources and timing of cost synergies, during its regularly scheduled quarterly earnings release on July 24, 2007.
Rob van der Merwe, chairman, president and chief executive officer of Paxar Corporation, announced that he will be leaving following the close of the transaction. Terry L. Hemmelgarn, newly named group vice president of Retail Information Services, will head the combined RIS Group. Hemmelgarns management team will consist of members of both Paxars and RIS leadership groups.
The purchase of Paxar has been initially funded through the commercial paper market, supported by a bridge facility arranged by JPMorgan Chase Bank, N.A. The Company remains committed to retaining a strong investment grade credit rating and to returning its financial ratios to target levels. The Company will work with JPMorgan Chase Bank, N.A., as arranger, and with the rating agencies to complete the permanent financing in the coming months.
About Avery Dennison Corporation
Avery Dennison is a global leader in pressure-sensitive labeling materials, office products and retail tag, ticketing and branding systems. Based in Pasadena, Calif., Avery Dennison is a FORTUNE 500 Company with 2006 sales of $5.6 billion. Combined with Paxar, Avery Dennison now employs more than 30,000 individuals in approximately 50 countries worldwide who develop, manufacture and market a wide range of products for both consumer and industrial markets. Products offered by Avery Dennison include: Fasson brand self-adhesive materials; Avery Dennison and Paxar brand products for the retail and apparel industries; Avery brand office products and graphics imaging media; specialty tapes, peel-and-stick postage stamps, and labels for a wide variety of automotive, industrial and durable goods applications.