CCL Industries to Acquire Checkpoint Systems for US$10.15 per Share

CCL Industries Inc., a world leader in specialty label and packaging solutions for global corporations, small businesses and consumers, announced today that it has entered into a definitive merger agreement whereby CCL will acquire Checkpoint Systems, Inc.for US$10.15 per share in an all-cash transaction valued at approximately $556 million, including net cash.

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The transaction has been unanimously approved by the boards of directors of both companies and is expected to close in mid-2016.

The US$10.15 per share in cash represents a premium of approximately 29% to the closing price on March 1, 2016, the last trading day prior to the signing of the definitive merger agreement.

Geoffrey T. Martin, President and Chief Executive Officer of CCL, said, "We have admired Checkpoint for many years as they built a unique, leading global position providing technology-driven label solutions to the retail & apparel industry. We are very pleased to welcome their deeply experienced people to CCL where they will continue to focus on this important industry for emerging 'smart label' technologies."

Checkpoint is a leading manufacturer of technology-driven, loss prevention, inventory management and labeling solutions, including RF and RFID-based, to the retail & apparel industry. The business has operations in 29 countries including 46 go-to-market units and 21 manufacturing facilities. For the last twelve months ended September 27, 2015, Checkpoint generated net revenue of approximately $820 million and Adjusted EBITDA (before synergies) of $83 million, resulting in an Adjusted EBITDA margin of 10.2%.

Transaction Rationale

The transaction represents a compelling and unique opportunity for CCL to enhance breadth and scale, while creating an opportunity to realize meaningful synergies, and earnings accretion as follows:

•Leading technology-driven label solutions provider to the retail and apparel sector
•Long-standing, blue-chip customer base of top global retailers and apparel brands
•Attractive 'smart label' product portfolio including radio-frequency identification ("RFID") solutions
•Global sales footprint spanning 29 countries serving all major retail markets
•Expands CCL's international operating platform, especially in Asia
•Identified annual synergies of up to $40 million
•Asset-light business model and improved working capital efficiency could accumulate significant free cash flow to drive rapid de-leveraging
•Meaningful and immediate earnings accretion

CCL intends to finance the transaction entirely with its existing US$1.2 billion revolving syndicated credit facility.

Financial Highlights

To achieve the targeted synergies, management estimates that non-recurring costs of $40 million will be incurred between closing and the end of 2018.

The transaction will be subject to Checkpoint shareholder approval at a special shareholder meeting expected to take place in the second quarter of 2016.

Closing of the transaction is subject to customary conditions, including receipt of relevant regulatory approvals, and is expected to occur in mid-2016, subject to approval of Checkpoint's shareholders.

Upon the closing of the transaction, Checkpoint will be reported as a new operating segment of CCL.

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