CCL acquires Avery Dennison’s European label converting business

Avery Dennison Corporation has signed an agreement to sell its package label converting business in Europe to CCL Industries Inc., the label and packaging solutions company based in Toronto, Ontario.

Cash proceeds from the sale are expected to be approximately $60 million. In addition, the deal includes a long-term, global supply agreement for Avery Dennison to provide pressure-sensitive base materials to CCL Industries. This supply contract is expected to generate revenue for the Company in 2004 that will partially offset the decrease in sales resulting from the divestiture. The transaction is expected to be finalized during the third quarter of 2003, subject to meeting customary closing conditions, including regulatory approvals.

The transaction involves the sale of two Avery Dennison package label converting facilities in Denmark, located in the cities of Brondby and Randers, as well as a package label converting plant in Chilly-Mazarin, France. The business serves European customers in the pharmaceutical, health and beauty aids, food and industrial markets with customized, self-adhesive labels for product packaging. The approximately 325 Avery Dennison employees at the three operations will become employees of CCL Industries.

At the same time, CCL Industries announced the completion of a 51 per cent controlled European joint venture deal with Pachem AG, a leading, privately held provider of pressure sensitive, shrink sleeve and in-mold labels. CCL Label will contribute its Avelin, France facility to the joint venture.