Acquisition of Beverage Can Manufacturing Business
Ardagh Group today announced that it has entered into an agreement ("Equity and Asset Purchase Agreement") with Ball Corporation (Ball) and Rexam PLC (Rexam) on 22 April 2016 to purchase certain metal beverage can manufacturing assets and support locations in Europe, Brazil and the United States for an enterprise value of US$3.42 billion including assumed liabilities of US$210 million. The completion of the acquisition is subject to certain conditions including regulatory approval and the closing of Ball's acquisition of Rexam.
Pursuant to the Equity and Asset Purchase Agreement, Ardagh will acquire ten beverage can manufacturing plants and two end plants in Europe, seven beverage can manufacturing plants and one end plant in the United States, two beverage can manufacturing plants in Brazil and certain innovation and support functions in Germany, the UK, Switzerland and the United States. These assets had 2015 sales of US$3 billion and standalone EBITDA of approximately US$400 million. The business to be acquired by Ardagh will be the number three beverage can manufacturer globally, number two in Europe and number three in the United States and Brazil.
Ardagh expects to finance the acquisition with a combination of cash and secured and unsecured debt. The acquisition is expected to close by the end of June 2016, simultaneous with the closing of Ball's acquisition of Rexam.
The US$3.21 billion cash purchase price represents a multiple of approximately 7 times standalone EBITDA including anticipated cost synergies.
Ardagh's Chairman, Paul Coulson, remarked that "We are pleased to expand our consumer packaging business with the addition of a leading beverage can business. Whilst we do not currently operate in the beverage can market, the business we are acquiring is highly complementary to our existing metal and glass businesses. The acquired business has an excellent management team and strong customer relationships."
Citigroup acted as exclusive financial adviser to Ardagh and Shearman & Sterling LLP was lead legal adviser to Ardagh.
For the disclosure of certain material information relating to the Ardagh Group and the proposed acquisition, please see www.ardaghgroup.com.
After ten very successful years as CEO of Ardagh, Niall Wall has informed the Board of his intention to step down in September. The Board of Ardagh thanks him for his enormous contribution to the success of the Group to date and wishes him well for the future. The Board is also pleased to announce the appointment of Ian Curley as CEO designate of Ardagh. Ian was CFO of Smurfit Kappa Group plc from 2000 until March of this year. Ian will join Ardagh in late June and succeed Niall Wall when he steps down in September.
About Ardagh Group
Ardagh Group is a global leader in glass and metal packaging solutions, producing packaging for most of the world's leading food, beverage and consumer brands. Following completion of the transaction announced today, it will operate 110 facilities in 22 countries, employ over 23,000 people and have global sales exceeding US$8.8 billion.
25 April 2016