Ball, a provider of metal and plastic packaging for food and beverage products, has purchased the remaining 65% stake in a joint venture metal beverage can plant in Sanshui, China from Guangdong Jianlibao Group.
The transaction was completed after the company received necessary approvals and clearances from the Chinese government. Ball owned 35% of the joint venture plant since 1992.
Ball acquired the plant and related assets for approximately $90m in cash. The company also entered into a long-term supply agreement with Jianlibao and its affiliate, Foshan Sanshui Jianlibao Trading.
Ball expects to report an after tax gain of approximately $25m in the second quarter of 2010 on its previous ownership interest in the joint venture, subject to the appraisal of the business.
Ball said that this strategic acquisition provides the company with additional capacity in a fast-growing region.
The company added that it is familiar with the plant and its customers, and this investment provides it greater flexibility to serve the growing Chinese market at a significantly lower cost than building a new facility and without adding additional capacity.
In November last year, the company had entered into an agreement to acquire the remaining interest in the beverage can plant.