Pactiv merger leaves questions about Canton mill site
Charlotte-based Novolex will merge with Pactiv Evergreen by mid-2025, if regulators approve the deal. Novolex photo
According to a press release issued Dec. 9, a merger between Pactiv Evergreen and Charlotte-based Novolex will provide better customer service, increased product innovation and additional distribution capabilities across North America, but what the merger means for Pactiv’s lawsuits, its languishing 185-acre parcel in Canton and the future of the town’s wastewater treatment, isn’t yet clear.
Novolex currently has more than 10,000 employees and 56 manufacturing facilities across Europe and North America that produce and distribute food packaging materials made of paper, plastic and renewables.
Per terms of the agreement, which is expected to close in mid-2025, Novolex will acquire Pactiv in an all-cash transaction valued at $6.7 billion, including Pactiv’s existing debt. The transaction will result in Pactiv becoming a privately held company, with its common stock being withdrawn from the NASDAQ. Shareholders will be paid $18 per share, a 49% premium.
“This transaction reflects the continuation of our long-term growth strategy to create the industry’s most innovative, sustainable and customer-focused company,” said Stan Bikulege, the chairman and CEO of Novolex who will lead the combined entities. “Pactiv Evergreen’s strong product portfolio, along with their talented team, will complement and add significant depth to Novolex’s diverse packaging solutions.”
Major shareholders of Novolex include global asset manager Apollo Funds, which manages more than $730 billion in assets and the Canada Pension Plan Investment Board, which manages more than $675 billion on behalf of 22 million beneficiaries.
Pactiv president and CEO Michael King said his company was pleased to reach an agreement, which has already been approved by Pactiv’s board of directors.
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“This milestone is a testament to our talented employees and Pactiv Evergreen’s inherent value,” King said in a press release. “Over the past three years, we’ve made significant progress on our transformation, focusing on our core strengths while driving operational excellence and enhancing profitability. We look forward to this next exciting chapter.”
That transformation, however, hasn’t worked out well for all parties involved — especially the town of Canton, where in 2023 Pactiv shuttered its century-old paper mill on short notice with little mind to the approximately 800 employees who lost their good-paying union jobs and health care coverage in the process.
As a result of the closing, Pactiv now finds itself embroiled in several sticky legal situations, including a lawsuit filed by Attorney General and Josh Stein earlier this year alleging the company violated terms of a JMAC economic development grant from the state in 2014.
A prospective buyer, Eric Spirtas, has been in talks to purchase the 185-acre mill site since at least May but is now being sued by Pactiv for failing to close the deal on Oct. 1, just days after Hurricane Helene devastated the region and damaged the parcel on Sept. 27.
The damage affected Pactiv’s wastewater treatment plant, which failed early in the storm, spilling untreated human waste into the Pigeon River. Structures and other infrastructure on the sprawling parcel may also have been affected. Pactiv has not allowed Spirtas or his representatives access to the site since the hurricane, per Spirtas.
“Two Banks [Spirtas’ LLC] stands currently with a contract, and Two Banks adamantly wants to close this deal. We have looked to close, wanted to close, expected to close, and there’s just a couple things missing. Number one, we need access to inspect the site,” Spirtas told The Smoky Mountain News Dec. 9. “The bottom line is, in fair dealings and fair standards, there’s no one that would say you can’t enter, you can’t inspect, and you can’t see what happened — just close.”
Since the mid-1960s, Canton has relied on the paper mill’s various owners to treat the town’s municipal waste, but that agreement expires in March 2025 and a solution hasn’t yet presented itself. The town has the money, thanks to the General Assembly, but has not located a site to build its own wastewater treatment plant. Construction of a new plant will take years.
Spirtas also voiced concerns over Pactiv’s repairs to the site and any insurance coverage the company may have.
Canton Mayor Zeb Smathers remarked on Pactiv’s continuing lack of communication about its ongoing state of affairs.
“I learned about this deal by text, from people here, not from Pactiv,” Smathers said.
The deal between Novolex and Pactiv Evergreen is still subject to regulatory approval.
“It is my hope and my expectation that all issues with the parcel, including the potential purchase and the JMAC agreement will be resolved by that time, and I fully expect they will be,” said Smathers.
Novolex didn’t immediately respond to a request for comment from The Smoky Mountain News.
This is a developing story.
