Silgan will acquire Amcor's White Cap closures business
Silgan Holdings Inc has entered into a definitive purchase agreement with Amcor Limited to acquire its White Cap closures business for €246m. White Cap is a leading supplier of an extensive range of metal closures to consumer goods packaging companies in the food and beverage industries in Europe, Asia Pacific and South America.
Silgan co-chairman and co-CEO, Phil Silver, says White Cap is a leading pioneer in vacuum closures for hot filled food and beverage applications, which are highly engineered to ensure seal integrity and provide ease of opening and resealabilty.
"With this acquisition, we are re-combining the business with its US counterpart, which started operation in 1926, and expect to benefit from the inherent synergies of a worldwide franchise," says Silver. "In combination with our current closure business in North America, the new Silgan White Cap business will be the Global leader in vacuum closures for hot filled food and beverage products, with number one positions in North America and Europe and either number one or number two positions in the developing markets of South America and Asia Pacific.”
The White Cap business, which had sales of approximately €246m for its fiscal year ended June 30, 2005, is headquartered in Hanover, Germany and operates a total of 10 manufacturing facilities in Europe, Asia Pacific and South America serving approximately 70 countries.
Silgan expects the transaction to be accretive to its 2007 earnings with additional opportunity as certain synergies and cost savings initiatives are realised.
The transaction, which is expected to be financed through borrowings under the Company’s senior secured credit facility or new senior subordinated notes, or a combination thereof, is expected to close during the second quarter of 2006, subject to specific closing conditions and other customary closing conditions.
Under the purchase agreement, the parties could initially close on the European business, which represents approximately 87 per cent of the total sales, and then subsequently close the other jurisdictions upon satisfaction of applicable closing conditions.
Silgan Holdings is a leading North American manufacturer of consumer goods packaging products with annual net sales of approximately $2.5bn in 2005. Silgan operates 60 manufacturing facilities in the US and Canada.
