O-I Glass' Australia and New Zealand business unit manufactures glass bottles and containers

OI glass

O-I Glass has agreed to sell Australia and New Zealand business unit. (Credit: Adam Radosavljevic from Pixabay)

Packaging and resource recovery company Visy Industries has signed an agreement to acquire the Australia and New Zealand (ANZ) business unit from O-I Glass for AUD $733m ($513m).

O-I has entered into a sale-leaseback agreement with Charter Hall for certain properties valued at around AUD $214m ($152.8m).

Gross proceeds on the sale, along with related sale-leaseback agreement with property management company Charter Hall, will approximate AUD $947m ($663m).

O-I and Visy have agreed that the divestment of the O-I ANZ business unit will be completed in two separate transactions. O-I will use the net proceeds from the deal to reduce its debt.

O-I ANZ is engaged in the manufacturing of glass bottles and containers for the customers in Australia and New Zealand.

O-I ANZ operates five manufacturing facilities

Based in Melbourne, the business unit operates five manufacturing facilities in Adelaide, Brisbane, Melbourne, Sydney and Auckland.

In 2019, the business unit reported sales of around AUD $754m ($528m) and EBITDA of approximately AUD $124m ($86.8m).

The divestment to Visy is subject to customary closing conditions, and both transactions have already secured the required regulatory approvals and closing is expected by the end of August.

O-I Glass CEO Andres Lopez said: “The sale of our ANZ operations is consistent with our strategy to properly align our business with the interests of our global customer base, improve financial flexibility and maximize shareholder value.

“O-I will continue to develop its leading market positions across Europe and the Americas as well as the company’s interests in Asia. The sale of ANZ follows an in-depth strategic review of our global business portfolio and operating structure which is now substantially complete following this transaction.”

In December 2019, O-I Glass completed corporate modernisation and adopted a new holding company structure to improve the operating efficiency and cost structure.