Amcor Spins Off AAPD In Hopes of Better Growth and Gains

Amcor, a leading packaging company in Australia, will be spinning off its Australian and New Zealand bottling, canning and carton operations. The demerged company, Australasia and Packaging Division (AAPD), will have an estimated value of $2 billion when its listed on the Australian Securities Exchange.

Standing as chairman for AAPD will be Chris Roberts who is part of the Amcor board, while Nigel Garrard has been named the Chief Executive of the company.

The move, according to Amcor, will give both companies the chance to “pursue their own growth agendas and strategic priorities”. Amcor will remain focused on plastic packaging and caters to a global demand, while AAPD will be keen on beverage cans and fibre glass packaging markets, including that of North America.

In a statement, Ken MacKenzie, Amcor’s chief, said, “Although Amcor and AAPD are both packaging companies they are actually very different in terms of product segments and geographic focus.” Mr. MacKenzie will continue to act as Chief Executive for the Amcor.

Nevertheless, this move will still have to meet the approval of the shareholders, but the companies are confident the shareholders will see the “value by enabling each company to better pursue their own growth agendas and strategic priorities”. They expect everything will be all set by December 2013.

Nearly a decade ago, Amcor also spun off Paperlinx, its paper business, when the company had been underperforming at the stock exchange.

At trade today, Amcor shares were up to 2.7%, closing at $10.88, following the announcement.