Silgan expects the acquisition of Albéa dispensing business to significantly enhance its scope and breadth of closures franchise


Consumer goods packaging firm Silgan to acquire Albea’s dispensing business for $900m. (Credit: Devashish Rawat from Pixabay)

US-based consumer goods packaging supplier Silgan has agreed to purchase the dispensing business of packaging company Albéa for $900m.

Albéa’s dispensing business supplies pumps, sprayers, and foam dispensing solutions to major consumer goods product companies within the personal care and beauty markets.

The business operates 10 manufacturing plants located across North America, Europe, South America and Asia.

Silgan seeks to broaden closures franchise by acquiring Albea’s dispensing business

Silgan chairman and CEO Tony Allott said that the acquisition would significantly enhance the company’s scope and breadth of closures franchise by bringing new products and capabilities in the engineered dispensing category.

Allott added: “The Albea dispensing business is a ‘hand-in-glove’ fit with our closures business. Like Silgan, this business has a long history as a differentiated packaging franchise with deep customer relationships and a strong track record of product innovation to meet customer needs.

“This proposed acquisition would allow us to expand relationships and product offerings with global customers, bring new customer relationships and provide cost synergy opportunities of $20 million. It would also create an incremental platform for growth and strongly enhance our free cash flow.

“We believe this business, like Silgan, holds similar passions for excellence in customer support, quality, safety and competitive franchise positions, while maintaining a strong focus on returns and free cash flow.”

Subject to the regulatory approvals and satisfaction of certain customary conditions, the proposed acquisition is planned to be completed in the first half of 2020.

Following the completion of the required consultations, the US-based consumer goods packaging supplier plans to enter into a definitive purchase agreement with Albea and certain of its subsidiaries for the purchase and sale of the business.

Upon completion of the deal, Silgan will expand its offerings to include engineered foam pumps, fine mist pumps, lotion pumps, samplers and fragrance caps and closures for the personal care and beauty products.

Silgan plans use a combination of cash and borrowings under the company’s senior secured credit facility to fund the proposed acquisition.

In October 2019, French personal care company L’Oréal and Albéa have jointly launched carton-based tube for cosmetic packaging.