Sonoco Products Co. 'BBB+' Rating Affirmed On Acquisition; Outlook Revised To Negative From Stable

Hartsville, S.C.-based packaging company Sonoco Products Co. is acquiring Clear Lam Packaging Inc. We are affirming our ratings on Sonoco and are revising the outlook to negative from stable. The negative outlook reflects the 1-in-3 potential that we will lower our ratings on Sonoco over the next two years if the company's funds from operations (FFO)-to-debt ratio is not at least 35% on a run-rate basis. NEW YORK (S&P Global Ratings) June 26, 2017-- S&P Global Ratings revised its outlook on Sonoco Products Co. to negative from stable and affirmed all of its ratings on the company. The negative outlook reflects the 1-in-3 potential that we will lower our ratings on Sonoco over the next two years because its proclivity

...+ Hartsville, S.C.-based packaging company Sonoco Products Co. is acquiring Clear Lam Packaging Inc. + We are affirming our ratings on Sonoco and are revising the outlook to negative from stable. + The negative outlook reflects the 1-in-3 potential that we will lower our ratings on Sonoco over the next two years if the company's funds from operations (FFO)-to-debt ratio is not at least 35% on a run-rate basis. NEW YORK (S&P Global Ratings) June 26, 2017-- S&P Global Ratings revised its outlook on Sonoco Products Co. to negative from stable and affirmed all of its ratings on the company. The negative outlook reflects the 1-in-3 potential that we will lower our ratings on Sonoco over the next two years because its proclivity for debt-funded acquisitions could result in its FFO-to-debt ratio staying below 35% for an extended period. Recently, the company announced its intent to purchase Clear Lam Packaging Inc., an Elk Grove, Ill.-based maker of flexible and rigid packaging, for $170 million....

Ratings Action