425: Berry Global Announces Leadership Structure for NewCo Following Glatfelter Acquisition

Berry Global unveils the organizational structure and leadership team for NewCo, the entity formed after the acquisition of Glatfelter, focusing on a regional operating model.

Summary

• Berry Global has announced the intended organizational structure and leadership appointments for NewCo, the entity that will result from the acquisition of Glatfelter.
• NewCo will operate under a regional model, dividing operations into two primary regions: the Americas, and Europe, Middle East, Asia & rest of world (EMEIA).
• This regional structure aims to expedite decision-making at the local level.
• Glatfelter's Composite Fibers business and specialty businesses from both Berry and Glatfelter will be integrated into these regions.
• The leadership team includes appointments from both Glatfelter and Berry, with Jim Till as CFO & Treasurer, Tarun Manroa as Chief Operating Officer, Phil Lerro as Chief Information Officer, Achim Schalk as President EMEIA & Asia, and David Parks as President Americas.
• Patricia Sargeant will lead North American Sales, Eileen Beck will lead Global Human Resources, and Kathy Vanderheyden will lead Business Excellence & Integration, Quality, Regulatory and EHS.
• Paul Harmon will lead Global Innovation, Sustainability, Corporate Branding and Marketing, and Robert Weilminster will lead Corporate Development, Strategy, Investor Relations and Integration.
• Several Glatfelter senior leaders, including Boris Illetschko, Will Wiley, and Vishal Bansal, will depart after the closing of the transaction.
• The new company name, logo, and brand will be announced over the summer months.
• Curt Begle, President of Berry Health, Hygiene & Specialties, will be the CEO of the combined company.

Sentiment

Score: 7

Explanation: The document conveys a positive outlook regarding the integration and future success of NewCo, with a focus on collaboration and achieving business objectives. However, the departure of key Glatfelter leaders introduces a note of caution.

Positives

• The regional operating model is expected to expedite decision-making.
• Integration of Glatfelter's Composite Fibers business into the regional structure reinforces the importance of these markets.
• Leadership appointments include individuals from both Glatfelter and Berry, potentially leveraging expertise from both organizations.
• The announcement of the new company name, logo, and brand is anticipated, which could generate excitement and positive sentiment.

Negatives

• Several key Glatfelter senior leaders will be leaving the business after the closing of the transaction, which could lead to a loss of institutional knowledge.
• The change to a regional structure may require adjustments for Glatfelter employees accustomed to a global functional operating model.

Risks

• The integration of the two companies may be more difficult, time-consuming, or costly than expected.
• There are risks related to financial community and rating agency perceptions of each of Berry and Glatfelter.
• The announcement, pendency, or completion of the proposed transaction could affect the ability to retain customers and key personnel.
• The risk that Glatfelter shareholders may not approve the transaction proposals.

Future Outlook

The document outlines the future organizational structure and leadership team of NewCo, the entity formed after the acquisition of Glatfelter by Berry Global. The new company name, logo, and brand will be announced over the summer months. The document also contains forward-looking statements regarding the expected timing, completion, and effects of the proposed transaction, which are subject to various risks and uncertainties.

Management Comments

• Curt Begle: 'Over the last few months, I have met with the Board of Directors of Glatfelter and Berry, as well as senior leaders from both organizations to align and create the best operating model for NewCo to ensure we are ready on day one to meet and exceed our business objectives and stakeholder expectations.'
• Curt Begle: 'I ask each of you to continue to perform at your highest level to deliver on our 2024 commitments, which is extremely important as we position our new company for success.'

Industry Context

This announcement reflects a trend of consolidation in the specialty materials and nonwovens industry, as companies seek to expand their product offerings, geographic reach, and market share. The regional operating model is a common approach for large, multinational corporations to manage diverse markets and customer needs.

Comparison to Industry Standards

• Berry Global's move to acquire Glatfelter and restructure operations under a regional model mirrors strategies employed by other large players in the packaging and specialty materials industry, such as Amcor and Sonoco.
• These companies often reorganize to streamline operations, improve responsiveness to local markets, and achieve synergies through integration.
• The focus on integrating specialty businesses into regional structures is also consistent with industry best practices, allowing for better alignment with customer needs and market dynamics.

Management Changes

Stakeholder Impact

• Shareholders of both Berry and Glatfelter will be impacted by the transaction and the resulting organizational changes.
• Employees of both companies will experience changes in reporting structures and job responsibilities.
• Customers may see changes in product offerings and service delivery as the companies integrate their businesses.

Next Steps

• Further announcements regarding the organizational structure and leadership details will be shared.
• The new company name, logo, and brand will be announced over the summer months.
• The integration process will continue to move forward.

Key Dates