Ireland-based packaging firm Ardagh Group has agreed to spin off its Food & Specialty Metal Packaging business and merge it with Exal, an aluminium containers producer, in a $2.5bn (£1.9bn) deal.
Image: Trivium Packaging will serve customers operating in markets such as food, seafood, pet food, nutrition, among other. Photo: courtesy of Ardagh Group.
Under the terms of the deal, the merger will lead to creation of a new company called Trivium Packaging, which will be one of the largest metal packaging companies in the world.
Ontario Teachers’ Pension Plan (Ontario Teachers’) currently controls Exal.
Based in the Netherlands, Trivium will operate 57 production facilities, mainly across the Americas and Europe. It will employ approximately 7,800 people.
The new entity will produce an extensive and sustainable product range to serve a diverse range of multinational, regional and local customers.
It will serve customers operating in the markets of food, seafood, pet food, nutrition, beauty and personal care, household care and premium beverages.
Ardagh chairman and CEO Paul Coulson will serve as Trivium chairman.
Coulson said: “Ardagh is delighted to partner with Ontario Teachers’ as shareholders in Trivium, a combination of two highly complementary and well-invested businesses.
“Trivium has the products, customers, innovation capabilities and leadership team to deliver continued growth and success, as brand owners and consumers increasingly seek sustainable packaging solutions.”
Upon completion of the deal, Ardagh will hold 43% stake in the new metal packaging business while the remaining 57% stake will be controlled by Ontario Teachers’.
Trivium CEO Michael Mapes said: “Trivium establishes a focused global leader at a time when metal packaging is poised to provide a compelling solution to help address the sustainability concerns facing consumers, brand owners, and governments.”
Subject to the customary closing conditions, including receipt of regulatory approvals and confirmation of the participation of certain Ardagh European entities, the transaction is scheduled for completion in the fourth quarter of 2019.
Ontario Teachers’ equities executive managing director Jane Rowe said: “In forming Trivium we are bringing together two leading businesses to create a global packaging company that is well-positioned to capitalise on current market trends.”
Proceeds from the transaction will be used by Ardagh to repay debt options.