French building materials company Cie de Saint-Gobain SA moved a step closer to selling glass-packaging unit Verallia.
Saint-Gobain said in a statement today that it had entered into exclusive talks with Apollo Global Management LLC to sell the division for €2.95 billion.
Saint-Gobain had already sold the North American part of the unit to Ardagh Group SA as chairman and chief executive officer Pierre-Andre de Chalendar focused the company on the building materials market.
While its proposed acquisition of Sika would come as the next step in Saint-Gobain’s transformation, de Chalendar faced a prolonged legal battle to gain control of the Swiss adhesives maker as its management resisted the deal.
The Courbevoie, France-based Saint-Gobain had reached a deal in December with Sika’s founding family to acquire a 16-per cent stake with 52 per cent of the voting rights for 2.75 billion Swiss francs ($2.9 billion).
However, the deal is being opposed by Sika’s management and smaller investors, claiming a combination made no strategic sense in a deal that handed the Burkard family an 80-per cent premium, while other shareholders got nothing.
Saint-Gobain shares rose 0.1 per cent as of 11:30 am, valuing the company at €24 billion, while France’s CAC 40 index retreated 0.5 per cent.
The company said Apollo was also in talks with Banque Publique d’Investissement, a French government-owned investment fund, about the fund’s potential acquisition of a minority stake in Verallia.
In a press release, de Chalendar said the sale of Verallia would complete the Saint Gobain’s ”strategic refocus on the design, manufacture and distribution of innovative, high-performance solutions for the habitat and industrial markets.”
Verallia employes a workforce of 10,000 people at 47 plants in 13 countries and reported sales of €2.4 billion, or about $2.7 billion, in 2014, excluding its North American operations.
The company had agreed to the sale of Verallia’s North American business to the Ardagh Group in January 2013 for $1.7 billion, though, the deal failed to materialise until April last year.
“We are extremely excited to be acquiring Verallia, which is an outstanding franchise and one of the world’s leading packaging companies,” Robert Seminara, a senior partner at Apollo, and Jean-Luc Allavena, an operating executive at the company, said in a news release.