What happened

Shares of Bemis Company, Inc. (NYSE:BMS), a manufacturer of flexible packaging, primarily for the food, medical, and consumer product industries, are up 11% as of 2:45 p.m. EDT Friday after rumors swirled that it could be acquired by a competitor.

So what

Amcor Ltd., an Australia-based packaging company operating around the globe, is in advanced discussions to acquire its U.S. based rival Bemis Company, per The Wall Street Journal. The rumor was enough to send shares of Bemis higher, which does roughly 70% of its sales in the U.S. compared to roughly one-third for Amcor's sales. Bemis has recently taken strides to turn around its margins, and if the combined company could generate cost synergies, it could be a move that makes strategic sense for both entities.

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Image source: Getty Images.

Now what

Although neither company is likely to confirm anything until it's official, the report said a deal could be announced as soon as next week -- although it's not impossible for these developments to breakdown at any time -- and based on typical premiums paid for acquisitions, it could end up being a roughly $5 billion deal.

Daniel Miller has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.