Shares of Berry Global Group took a hit following the announcement that the company would be spinning off a significant portion of one of its businesses and merging it with manufacturing firm Glatfelter.

Currently, the stock is down 10% at $57.83 in recent trading, with a total decline of over 14% since the beginning of the year. On the other hand, Glatfelter's shares have experienced an impressive surge of 77% to $2.27.

In a statement released on Wednesday morning, the plastic packaging maker revealed its plans to spin off the sector of its health, hygiene, and specialties segment that encompasses its global nonwovens and films business.

Once separated, this spun-off business will merge with Glatfelter, resulting in the establishment of a leading specialty materials company. The new venture will possess an enterprise value of $3.6 billion. Berry shareholders will hold a 90% ownership stake in the newly formed company, while Glatfelter shareholders will retain the remaining interest.

Anticipated to be finalized in the second half of 2024, this deal marks a significant milestone for both Berry Global Group and Glatfelter.

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