Avery Dennison Acquires Vestcom

Jacqueline Barba
Associate Editor
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Avery Dennison has completed its acquisition of Vestcom, a provider of shelf-edge communications and specialized marketing and labeling services for the retail industry, for $1.45 billion.

Vestcom will help advance Avery Dennison’s strategies, including accelerating its adoption of smart labels, by bringing new assets to drive similar automation and data management offerings to synthesize and streamline store-level data and deliver item-specific, price-integrated and promotional messaging at shelf edge. The cash transaction was first announced in July.

As one, Avery Dennison and Vestcom plan to accelerate their respective solutions, and combine inventory availability, price management and frictionless checkout to offer a complete solution across multiple U.S. retail channels. Some new capabilities include:

  • An end-to-end retail experience that bridges the physical and digital, driving conversion amongst retail shoppers, while providing opportunities to engage shoppers at point of purchase with digital solutions embedded directly into apparel and footwear items.
  • Strong promotional capabilities at shelf edge and point of sale signage, with an extensive North American footprint.
  • Solutions to engage consumers digitally on the shelf, on the rounder and on the product itself, so retailers can interact with consumers pre-purchase, post-purchase and throughout the product life cycle. 

Headquartered in Little Rock, AR, Vestcom has 11 U.S. production facilities and approximately 1,200 employees, with sales across multiple U.S. retail channels, including grocery (e.g. Albertsons Companies and Meijer), drug and dollar.

Avery Dennison hopes the acquisition of Vestcom’s “high-growth, high-margin” business will accelerate its portfolio shift to high-value categories and the company’s 2022 earnings per share (EPS), net of purchase accounting amortization and financing costs.

“[The acquisition] marks a significant milestone in the history of Vestcom,” said John Lawlor, chairman and CEO of Vestcom, in a July media release announcing the deal. “The capabilities of Avery Dennison will enable Vestcom to further accelerate innovation and continue delivering high-value solutions that drive sales and productivity for retailers and CPGs. And we look forward to bringing our expertise and data integration capabilities to new channels and markets with Avery Dennison.”

Goldman Sachs & Co. LLC and Latham and Watkins advised Avery Dennison on the transaction. Robert W. Baird & Co, Jefferies, RBC Capital Markets and Goodwin Procter LLP advised Charlesbank, the private investment firm that has owned Vestcom since late 2016, on the transaction.