Crown Holdings has entered into a definitive agreement to acquire EMPAQUE, a Mexican manufacturer of aluminum cans and ends, bottle caps and glass bottles for the beverage industry, from Heineken N.V., in a cash transaction valued at US$1.225 billion, subject to adjustment.
The acquisition is subject to customary closing conditions, including competition authority approval, and is expected to close by year end 2014 and contribute between US$0.15 and US$0.20 per share to Crown’s 2015 earnings before synergies, but including estimated amortization and depreciation for purchase accounting adjustments.
The information regarding the expected amount and timing of synergies will be provided in due course.
According to Crown chairman and CEO John W. Conway, the acquisition of EMPAQUE will significantly enhance Crown’s position in beverage cans, both regionally and globally.
In North America, Crown will become the second largest beverage can producer, supplying over 24 billion units annually to a balanced portfolio of beer and soft drink customers.
On a worldwide basis, after closing Crown will supply over 62 billion units annually, representing 20% of all beverage cans globally.
It will also bolster its geographic footprint, as more than 50% of beverage can revenue will be attributable to the faster growing developing regions.
The long-term supply agreements with Heineken affiliates will also provide a stable cash-flow base for the EMPAQUE business in Mexico.
With projected 2014 sales of approximately US$700 million and earnings before interest, taxes, depreciation, and amortization of approximately $150 million, EMPAQUE currently operates two beverage can plants, a plant that manufactures beverage can ends, aluminum closures and bottle caps, a glass bottle plant and a glass service facility in Mexico, with approximately 1,500 employees.
