Shares of Glatfelter experienced a significant surge following an announcement by Berry Global Group regarding a spin-off and merger with the manufacturing firm.
The stock price soared by an impressive 81% to reach $2.32 during premarket trading. This comes as a positive development for shareholders after the stock had experienced a decline of over one-third year-to-date as of the market closing on Tuesday.
Berry Global Group revealed on Wednesday morning that a portion of its health, hygiene, and specialties segment, which includes the global nonwovens and films business, will be spun off and merged with Glatfelter. The aim is to establish a leading specialty materials company.
Upon completion of the merger, the newly combined company will have an enterprise value of $3.6 billion. Berry shareholders are set to hold a 90% stake in the new company, with Glatfelter shareholders retaining the remaining portion.
The boards of directors from both companies have unanimously approved the deal, which is projected to conclude in the second half of 2024.