Packaging manufacturer Crown Holdings has agreed to sell its Europe, Middle East and Africa (EMEA) food packaging unit to private equity firm KPS Capital Partners, in a deal valued at €2.25 billion.
Crown’s European Tinplate business is one of the largest manufacturers of steel and aluminium food packaging in Europe, operating 44 manufacturing facilities in 17 countries across Europe, the Middle East and Africa. The business produces food cans and ends, aerosol cans, metal closures and promotional packaging for various consumer brands. According to Crown, the unit generated €1.9 billion in revenue in 2020.
Crown will receive pre-tax proceeds of approximately €1.9 billion from the sale and will retain a 20% ownership stake in the business, which will now operate as an independent company.
According to a statement from Crown, net proceeds from the sale will be used for debt reduction, beverage can capital projects and share repurchases over time.
The transaction is expected to close in the third quarter of 2021, and is subject to customary closing conditions and regulatory approvals.
Timothy Donahue, president and CEO, said: “We are very pleased that the European Tinplate business will have a strong owner in KPS Capital Partners to support future profitable growth and innovation initiatives. European customers and consumers alike have long embraced metal packaging, valuing the premium product protection and flavour preservation that it offers.
“The infinitely recyclable food can is unrivalled from a sustainability standpoint, helping eliminate over one billion litres a year in food waste. We are excited to retain a minority stake in the business alongside KPS as Crown shareholders will benefit from the KPS team and its track record of owning manufacturing companies and creating tremendous value.”
Michael Psaros, co-founder and co-managing partner of KPS Capital Partners, added: “We are excited to acquire one of the largest metal packaging businesses in Europe.
“The size and scale of the business, the breadth of its products and its critical food safety technology and process disciplines developed over decades, coupled with growing end-markets, are the foundation of a tremendous investment platform.”
By Martin White
Source: foodbev.com
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