Materials science leader Avery Dennison has announced a strategic move to strengthen its specialty adhesives business through the acquisition of a key division from Meridian Adhesives Group. The $390 million deal, initially disclosed on August 25, targets the US-based flooring adhesives unit, reinforcing the company’s focus on high-value niche markets.
The transaction encompasses the Taylor Adhesives, Polycom, and Frontier Products brands. Integration into Avery Dennison’s Materials Group is scheduled for completion during the fourth quarter of 2025. With the acquired business generating approximately $110 million in annual revenue, the company anticipates no material impact on its adjusted earnings per share for the current fiscal year.
Chief Executive Officer Deon Stander characterized the purchase as a significant component of the company’s dual-track growth strategy, combining organic development with strategic acquisitions in premium market segments. “This acquisition enhances our materials science capabilities and deepens our portfolio of specialized adhesive solutions,” Stander stated. The Meridian division is widely recognized throughout the flooring industry for its product quality, innovation, and strong customer relationships.
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The integration process will coincide with other strategic initiatives, including the upcoming showcase of sustainable packaging solutions and RFID technologies at the Labelexpo 2025 exhibition.
Financial analysts present a divided perspective on Avery Dennison’s market position. BMO Capital maintained its “Outperform” rating in July while reducing its price target from $216 to $207. The firm cited robust free cash flow generation and potential for double-digit EPS growth in 2026 and 2027 as key factors supporting its positive outlook. Conversely, JP Morgan downgraded the stock to “Neutral” back in April.
Avery Dennison shares were trading at $178.50 as of August 22. Market participants will be watching the company’s next earnings release on October 22 for early indications of whether these strategic moves are delivering the intended results.
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