Ardagh ties food packaging business with Exal to form Trivium Packaging

16 Jul 2019 --- Ardagh has announced that it has entered into an agreement to combine its Food & Specialty Metal Packaging business (“Food & Specialty”) with the business of Exal, a leading producer of aluminum containers, to form Trivium Packaging. The combining companies aim to establish “a global leader in metal packaging.” Ardagh reports that it will put the estimated US$2.5 billion that it is due to earn from the combination with Exal towards its US$8 billion debt.

The combination of Food & Specialty with Exal, currently controlled by Ontario Teachers’ Pension Plan Board, will create “one of the largest metal packaging companies in the world.” Trivium will be headquartered in the Netherlands and will operate 57 production facilities, principally across Europe and the Americas, employing approximately 7,800 people.

Pro forma revenues and Adjusted EBITDA in the twelve months ended March 31, 2019 were US$2.7 billion and US$469 million respectively. In addition, Trivium expects to derive net combination benefits of approximately US$40 million over the next few years, from the pursuit of commercial and operational excellence opportunities.

Trivium will serve a diverse range of leading multinational, regional and local customers operating in a wide array of end markets, including food, seafood, pet food, nutrition, beauty and personal care, household care and premium beverages.

This complementary transaction will combine Food & Specialty’s leading presence in Europe and North America, principally focused on tin-plate steel packaging, with Exal’s leadership in Americas aluminum aerosol packaging. Trivium will produce “an extensive and sustainable product range, backed by dedicated research and development resources, underpinning the businesses’ reputation for customer service, quality and innovation.”

Paul Coulson, Chairman and CEO of Ardagh, will be Chairman of Trivium. Michael Mapes, CEO of Exal, will be CEO and will lead a “highly experienced team” drawn from across both businesses. Upon completion of the transaction, Ardagh will hold a 43 percent stake in Trivium, with 57 percent controlled by Ontario Teachers’. Ardagh will also receive approximately US$2.5 billion in cash proceeds.

Completion of the transaction is subject to the satisfaction of customary closing conditions, including receipt of regulatory approvals and confirmation of the participation of certain Ardagh European entities in the transaction, which remains subject to works councils’ consultation. Completion is also subject to closing of the debt financing expected to be announced by Trivium this week. The transaction is expected to close in the fourth quarter of 2019.

“Ardagh is delighted to partner with Ontario Teachers’ as shareholders in Trivium, a combination of two highly complementary and well-invested businesses. Trivium has the products, customers, innovation capabilities and leadership team to deliver continued growth and success, as brand owners and consumers increasingly seek sustainable packaging solutions,” comments Paul Coulson, Chairman and CEO of Ardagh and Chairman of Trivium.

“In forming Trivium we are bringing together two leading businesses to create a global packaging company that is well-positioned to capitalize on current market trends. We are pleased to establish a partnership with Ardagh and believe our alignment on long-term value creation will be a critical driver for the future success of the enterprise,” adds Jane Rowe, Executive Managing Director, Equities, Ontario Teachers’.

“I am honored to lead Trivium, which combines two great organizations with a history of customer service and innovation derived from exceptional people and long-term customer relationships. Trivium establishes a focused global leader at a time when metal packaging is poised to provide a compelling solution to help address the sustainability concerns facing consumers, brand owners, and governments. I’m very excited about Trivium’s prospects for future success,” says Michael Mapes, CEO of Trivium.

In recent months, Ardagh has hit the headlines with further rollouts of its Nitro Can innovation. The Nitro Can has been adopted by UK cocktail mixer company Funkin Cocktails in a collaboration that sees the first-ever range of RTD nitro canned cocktails hit the shelves.

Likewise, liquid coffee extract producer Cafeahaus AG has launched Goldbrew – a ready-to-drink (RTD), cold-brewed coffee range in Ardagh’s 250ml slim can on the German market. The range includes “Goldbrew ginger & lemon” and “Goldbrew grapefruit & lemon.” The subsidiary of DEK Berlin has complimented the Goldbrew range with a nitro original cold brew coffee, which comes in Ardagh’s unique Nitro Can.

Furthermore, Ardagh launched a new slimline 187ml aluminum can, specially designed for wine and wine-based drinks.

Edited by Joshua Poole

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