Item 2.02 Results of Operations and Financial Condition.
The disclosure under "Guidance Update" under Item 7.01 of this Current Report on Form 8-K is incorporated in this Item 2.02 by reference. The information furnished under Item 2.02 in this Form 8-K shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section and shall not be deemed incorporated by reference in any registration statement or other document filed under the Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act, except as set forth by specific reference in such filing.
Item 7.01 Regulation FD Disclosure.
As described below under Item 8.01, onJanuary 17, 2023 ,Sealed Air Corporation , aDelaware corporation (the "Company") announced the commencement of an offering of the Notes (as defined below). In connection with the offering of the Notes, the Company provided certain information to prospective investors in a preliminary offering memorandum datedJanuary 17, 2023 (the "Preliminary Offering Memorandum"). The Preliminary Offering Memorandum disclosed certain information that supplements or updates certain prior disclosures of the Company. Information from that Preliminary Offering Memorandum is set forth below.
Expected Acquisition of
OnNovember 1, 2022 , the Company announced in its Current Report on Form 8-K the execution of a definitive purchase agreement, dated as ofOctober 31, 2022 (the "Acquisition Agreement"), to acquire all of the issued and outstanding shares of capital stock ofLB Holdco, Inc. , the parent company ofLiqui-Box, Inc. (collectively, "Liqui-Box"), on a cash-free and debt-free basis, for an aggregate purchase price of$1.15 billion in cash, subject to customary adjustments for (i) working capital, cash, certain specific tax attributes and indebtedness ofLiqui-Box at closing and (ii) specified transaction expenses (the "Liqui-Box Acquisition"). OnNovember 1, 2022 , the Company also announced that it had secured$1.0 billion of committed financing, including a commitment for a senior unsecured 364-day bridge loan (the "Bridge Loan Commitment") in connection with the Liqui-Box Acquisition. The Company expects to use a portion of the net proceeds from the Notes, along with cash on hand and the borrowing under its incremental term loan facility in the aggregate principal amount of$650 million to finance theLiqui-Box Acquisition. For the twelve months endedSeptember 30, 2022 ,Liqui-Box had net sales of$356.5 million , net loss of$84.3 million , and Adjusted EBITDA (as defined below) of$85.0 million . The financial information forLiqui-Box for the twelve months endedSeptember 30, 2022 is based on preliminary unaudited estimated financial data ofLiqui-Box provided to the Company byLiqui-Box , andLiqui-Box's Adjusted EBITDA is based on the financial information provided to the Company byLiqui-Box as adjusted byLiqui-Box management, and therefore the Company cannot assure readers of the accuracy or completeness of the information and readers should not place undue reliance on this financial information. ForLiqui-Box , Adjusted EBITDA is defined as Net earnings (loss) before interest expense, net, income tax provision, depreciation and amortization, foreign currency impacts for intercompany activity, net of adjustments, adjusted to exclude the impact of certain specified items (collectively, "Liqui-Box Special Items"), including integration and restructuring costs, sale and leaseback adjustments, transaction related expenses, pro forma adjustments, and certain other adjustments.Liqui-Box evaluated Liqui-Box Special Items on an individual basis.Liqui-Box's evaluation of whether to exclude a Liqui-Box Special Item for purposes of determiningLiqui-Box's non-U.S. GAAP financial measures considered both the quantitative and qualitative aspects of the item, including among other things (i) its nature, (ii) whether or not it related toLiqui-Box's ongoing business operations, and (iii) whether or notLiqui-Box expected it to occur as part of its normal business on a regular basis. Set forth below forLiqui-Box is a reconciliation ofU.S. GAAP net earnings (loss) to Adjusted EBITDA. Twelve Months EndedSeptember 30, 2022 (1)
(In millions)
$ (84.3) Interest expense, net................................................................................................................................................................................... 40.8 Income tax provision.................................................................................................................................................................................. 4.1 Depreciation and amortization................................................................................................................................................................... 81.6 Foreign currency impacts for intercompany activity(2)............................................................................................................................... 12.6 Liqui-Box Special Items:............................................................................................................................................................................
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Integration and restructuring costs(3)................................................................................................................................................ 5.3 Sale leaseback adjustments(4)........................................................................................................................................................... 3.7 Transaction related expenses(3)........................................................................................................................................................ 4.4 Pro forma adjustments(5).................................................................................................................................................................. 15.2
Other
adjustments(6).........................................................................................................................................................................
1.6 Pre-tax impact of Liqui-Box Special Items............................................................................................................................................ 30.2 Non-U.S. GAAP Liqui-Box Adjusted EBITDA........................................................................................................................................ $ 85.0 (1)The financial information forLiqui-Box for the twelve months endedSeptember 30, 2022 is based on preliminary unaudited estimated financial data ofLiqui-Box provided to the Company byLiqui-Box , andLiqui-Box's Adjusted EBITDA is based on the financial information provided to the Company byLiqui-Box as adjusted byLiqui-Box management, and therefore the Company cannot assure readers of the accuracy or completeness of the information and readers should not place undue reliance on this financial information. (2)Pertains to foreign currency translation and revaluation impacts primarily related to intercompany activity between affiliates ofLiqui-Box that are remaining with the sellers and not being acquired by the Company. (3)Pertains to integration and restructuring efforts, and related deal costs of acquisition activity incurred byLiqui-Box prior to the Liqui-Box Acquisition. Additionally, deal costs also include transaction costs incurred byLiqui-Box related to the Liqui-Box Acquisition. . . .
Item 8.01 Other Information.
Tender Offer
OnJanuary 17, 2023 , the Company announced that it commenced a cash tender offer (the "Tender Offer") for any and all of its outstanding €400 million aggregate principal amount of 4.500% Senior Notes due 2023 (the "2023 Euro Notes"). A copy of the press release, datedJanuary 17, 2023 , announcing the commencement of the Tender Offer is attached as Exhibit 99.1 hereto and is incorporated herein by reference. New Notes Offering Also, onJanuary 17, 2023 , the Company announced that, together withSealed Air Corporation (US) , aDelaware corporation and a wholly owned subsidiary of the Company (together with the Company, the "Issuers"), the Issuers commenced an offering of senior notes due 2028 (the "Notes"). The Notes will be jointly and severally, and irrevocably and unconditionally, guaranteed on a senior unsecured basis by each of the Company's existing and future wholly owned domestic subsidiaries that guarantee its senior secured credit facilities, subject to release under certain circumstances, although, for purposes of this offering,Sealed Air Corporation (US) is a co-issuer and not a guarantor. The Issuers intend to use the net proceeds from the offering of the Notes, (i) together with a borrowing under the Company's incremental term loan facility and cash on hand, to finance the acquisition ofLB Holdco, Inc. , the parent company ofLiqui-Box, Inc. , including related fees and expenses, (ii) to repurchase any or all of the Company's outstanding 2023 Euro Notes pursuant to the Tender Offer commenced by the Company today and satisfy and discharge all of the Company's outstanding 2023 Euro Notes in accordance with the terms of the indenture governing the 2023 Euro Notes and to pay related premiums, fees and expenses in connection therewith and (iii) to the extent of any remaining proceeds after giving effect to the foregoing transactions, for general corporate purposes. A copy of the press release, datedJanuary 17, 2023 , announcing the offering of the Notes, is attached as Exhibit 99.2 hereto and is incorporated herein by reference. The Notes and related guarantees will be offered only to qualified institutional buyers under Rule 144A of the Securities Act, as amended and to non-U.S. persons in transactions outsidethe United States under Regulation S of the Securities Act. The Notes have not been registered under the Securities Act, and, unless so registered, may not be offered or sold inthe United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and other applicable securities laws. This announcement shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Notes, in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
Update on Liqui-Box Acquisition
The information set forth in the second to last paragraph under the heading
"Expected Acquisition of
Update on Bridge Loan Commitment
The information set forth in the last paragraph under the heading "Expected
Acquisition of
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This report contains "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 concerning the Company's business, consolidated financial condition, results of operations, or cash flows. TheU.S. Securities and Exchange Commission ("SEC") encourages companies to disclose forward-looking
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statements so that investors can better understand a company's future prospects and make informed investment decisions. Forward-looking statements are subject to risks and uncertainties, many of which are outside the Company's control, which could cause actual results to differ materially from these statements. Therefore, you should not rely on any of these forward-looking statements. Forward-looking statements can be identified by such words as "anticipate," "believe," "plan," "assume," "could," "should," "estimate," "expect," "intend," "potential," "seek," "predict," "may," "will" and similar references to future periods. All statements other than statements of historical facts included in this report regarding the Company's strategies, prospects, financial condition, operations, costs, plans and objectives are forward-looking statements. Examples of forward-looking statements include, among others, statements the Company makes regarding expected future operating results, the expected consummation of the Liqui-Box Acquisition,Liqui-Box's expected future operating results, expectations regarding the results of restructuring and other programs, expectations regarding the results of business strategies and transformations (including expected cost synergies following the Liqui-Box Acquisition), anticipated levels of capital expenditures and expectations of the effect on the Company's financial condition of claims, litigation, environmental costs, contingent liabilities and governmental and regulatory investigations and proceedings. The following are important factors that the Company believes could cause actual results to differ materially from those in the Company's forward-looking statements: global economic and political conditions, currency translation and devaluation effects, changes in raw material pricing and availability, competitive conditions, the success of new product offerings, consumer preferences, the effects of animal and food-related health issues, the effects of epidemics or pandemics, including the Coronavirus Disease 2019, negative impacts related to the ongoing conflict betweenRussia andUkraine and related sanctions, export restrictions and other counteractions thereto, changes in energy costs, environmental matters, the success of the Company's restructuring activities, the success of the merger, acquisition and equity investment strategies, the success of the Company's financial growth, profitability, cash generation and manufacturing strategies and the Company's cost reduction and productivity efforts, changes in the Company's credit ratings, the tax benefit associated with the Settlement agreement (as defined in Note 18 to the condensed consolidated financial statements included in Part I, Item 1 of the Company's Quarterly Report on Form 10-Q for the fiscal quarter endedSeptember 30, 2022 ), regulatory actions and legal matters, and the other information referenced in Part I, Item 1A, "Risk Factors" of the Annual Report on Form 10-K for the fiscal year endedDecember 31, 2021 , and as revised and updated by the Company's Quarterly Reports on Form 10-Q for the fiscal quarters endedMarch 31, 2022 ,June 30, 2022 andSeptember 30, 2022 , as filed with theSecurities and Exchange Commission , and as revised and updated by the Company's Current Reports on Form 8-K. Any forward-looking statement made by the Company in this report is based only on information currently available to the Company and speaks only as of the date on which it is made. The Company undertakes no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise. NON-U.S. GAAP INFORMATION Non-U.S. GAAP measures are used by management to review and analyze our operating performance and, along with other data, as internal measures for setting annual budgets and forecasts, assessing financial performance, providing guidance and comparing our financial performance with our peers and may also be used for purposes of determining incentive compensation. The non-U.S. GAAP information has limitations as an analytical tool and should not be considered in isolation from or as a substitute forU.S. GAAP information. It does not purport to represent any similarly titledU.S. GAAP information and is not an indicator of our performance underU.S. GAAP. Non-U.S. GAAP financial measures that we present may not be comparable with similar titled measures used by others. Investors are cautioned against placing undue reliance on these non-U.S. GAAP measures. Information reconciling forward-lookingU.S. GAAP measures to non-U.S. GAAP measures is not available without unreasonable effort. For non-U.S. GAAP financial measures presented for the Company, we have not provided guidance for the most directly comparableU.S. GAAP financial measures, as they are not available without unreasonable effort due to the high variability, complexity, and low visibility with respect to certain Special Items, including restructuring charges, adjustments in the valuation of our "SEE Ventures " portfolio (which may include debt, equity method, or equity investments), gains and losses related to acquisition and divestiture of businesses, the ultimate outcome of certain legal or tax proceedings, and other unusual gains and losses. The Company is unable to predict with reasonable certainty the ultimate outcome of certain significant items required for the reconciliation. These items are . . .
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit Number Description Press release, datedJanuary 17, 2023 announcing the commencement of the 99.1 Tender Offer. Press release, datedJanuary 17, 2023 , announcing the offering of the 99.2 Notes. Cover Page Interactive Data File--the cover page XBRL tags are embedded 104 within the Inline XBRL document.
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