Silgan eyes CEE expansion with acquisition of Vogel and Noot food can ops
The US-based firm said it expected to close the deal in the first quarter of 2011 – subject to a price adjustment for the net debt and financial performance of Vogel & Noot, and approval from regional competition authorities.
Silgan announced the takeover of the Vienna-based company would give it an extended foothold in the developing markets in the CEE region. Vogel & Noot has a dozen plants spread throughout the bloc with more due to come on stream in future.
"As a leader in the metal food can business, we are excited about the opportunity to expand the Silgan franchise as we partner with our global customers to support their growth in the Central and developing Eastern European markets," said company president and CEO Tony Allott.
He highlighted Vogel & Noot’s “proven track record” for operating within the “important markets” of CEE as a key factor behind the proposed acquisition.
“With plants currently operational in Germany, Austria, Poland, Greece, Macedonia, Belarus, Slovakia, and Slovenia and several new locations scheduled to come on line in the near term, the business is uniquely positioned to meet the growing needs of these markets and our global customers," Allott added.
Modestly accretive in 2011
Silgan said it expected the move to generate annual sales of around €250m, although its new subsidiary would only be “modestly accretive” next year. The purchase would be funded from a mixture of cash and borrowing. The proposed price for the Austrian firm is 6.5 times its projected EBITA after expected future earnings of the locations under development, added a Silgan statement.
As well as food cans, Vogel and Noot manufactures decorative cans, fish cans, twist off caps and chemical containers.
Silgan, headquartered in Connecticut, said it posted sales of US$3.1bn in 2009 and operates 68 manufacturing facilities in North and South America, Europe and Asia. It claims to be the largest supplier of metal containers to the food industry in the US and Canada.