Owens-Illinois (O-I) has entered into an agreement to acquire a Mexican glass manufacturing plant from Grupo Modelo, an affiliate of AB InBev.
The Nueva Fábrica Nacional de Vidrio facility, which is located near Mexico City, will be bought for approximately $188 million. The site currently has four furnaces to produce and supply approximately 300,000 tons of glass containers annually for Grupo Modelo brands such as Corona, Modelo Especial and Pacífico.
O-I expects the business to contribute approximately $140 million of revenue and $40 million EBITDA on an annual basis. The glass manufacturer will also enter into a long-term agreement to continue to supply glass to Grupo Modelo.
Andres Lopez, O-I CEO, said: “The acquisition of Nueva Fanal reflects O-I’s strategy to invest in the growth of sustainable glass packaging by partnering with our customers to help enable their growth in premium brands, such as Corona, one of the most popular and fastest growing beer brands globally.
“This investment is in addition to our recently announced nearly 50% acquisition of Empresas Comegua S.A. as well as our plans to expand our Gironcourt, France, glass plant. These, along with the investment in the Nueva Fanal glass plant, are examples of the near-term strategic growth opportunities we discussed at our November 2018 investor day and incorporated into our 2019 outlook.”
The Gironcourt plant expansion was announced last month and will see O-I invest more than $60 million as it responds to growing consumer demand for sustainable glass packaging. It is expected the project will be completed in early 2020.
Headquartered in Perrysburg, Ohio, O-I employs more than 26,500 people at 77 plants in 23 countries. Last year, the firm had revenues of $6.9 billion.
By Jules Scully
Source: FoodBev
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