Silgan Holdings a supplier of rigid packaging for consumer goods products, has entered into a definitive purchase agreement to purchase Rexam's plastic thermoformed food business.
This business, with anticipated sales of approximately $100m in 2012, provides thermoformed packaging solutions such as retortable bowls and barrier trays to many of the world’s leading packaged food and ready-meal companies.
Tony Allott, president and CEO of Silgan, said: “This business is uniquely positioned for the growing demand in the ready-meals market through its low cost technology which meets the rigorous requirements of the shelf-stable food market.
"The ability to provide our existing customers with product line extensions that offer convenient, on-the-go capabilities makes it an excellent fit within the Silgan suite of products.”
The purchase price for this transaction is $250m and is expected to be neutral to Silgan’s 2012 earnings primarily due to the initial write-up of inventory required for accounting purposes, and modestly accretive to earnings in 2013 based on current growth expectations.
The transaction is expected to close in the third quarter of 2012, subject to certain customary conditions and regulatory approvals, and Silgan expects to fund the purchase price from cash on hand.
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- Distribution > Retail
- Food > New Products
- Manufacturing > Processing
- Packaging > Plastic