Packaging company Amcor is considering a takeover of smaller US rival Bemis Co.
Amcor is working with advisers to explore a bid for Bemis, which has a market valuation of about $US4.3 billion (Amcor is three times that at $US14.5 billion)
Bloomberg says the possible deal is at an early stage and is not certain if Amcor has made an initial approach to Bemis.
Bemis is based in the US state of Wisconsin and has 59 facilities in 12 countries and employs about 17,500. It had 2016 net sales of $US4 billion. It makes a range of flexible and rigid plastic packaging products.
Shares in Bemis, traded in New York, rose 9.9% to $US46.90 on Thursday after the rumours emerged. Amcor shares hardly moved in the first hour of trading in Sydney on Friday, down 0.15% at $15.69.
Blooberg said that in June, Bemis outlined a restructuring and cost savings plan to improve profitability primarily in its US and Latin American businesses by reducing its manufacturing and administrative cost structure.
This plan targets an annual savings of $US55 million to $US60 million, with savings starting in 2017 and fully realised during 2019. The cost of the plan are between US100 million to $US120 million.
