Acquisition of Cott’s bottling activities
On July 25, 2017, Refresco announced the signing of a definitive agreement with Cott to acquire Cott’s bottling activities for $ 1.25 billion, creating the world’s largest independent bottler with leadership positions in Europe and North America. Cott’s bottling activities consist of 24 production sites in North America and 5 in the UK. It is a business with 2016 revenues of $ 1.7 billion[1], adjusted EBITDA of $ 136.5 million[2] and strong cash flow. The acquisition anticipates the expected retail brands market growth in the US driven by the expansion of hard discounters, expanding footprint of online retailers and macro factors enabling retail brands growth. The acquisition has significant synergy potential of around € 47 million. It will be more than 5 % earnings accretive already in the first full year of consolidation and considerably higher in the second and third year. The acquisition will be fully financed with debt. The company intends to issue € 200 million in new shares at the earliest opportunity. The transaction is expected to close in the second half of 2017.
Q2 2017 Highlights[3]
- Volume increased 20.5 % to 2,052 million liters. Organic volume growth was 2.8 %.
- Contract manufacturing volume increased to 37.7 % of total volume mainly driven by acquisitions.
- Gross profit margin per liter amounted to 13.4 euro cents in line with the expected impact of last year’s acquisition in the US (Q2 2016: 14.0 euro cents). Like-for-like gross margin per liter was 13.9 euro cents.
- Adjusted EBITDA amounted to € 66 million (Q2 2016: € 68 million).
- Adjusted EPS was € 0.34 (Q2 2016: €0.37).
CEO Refresco, Hans Roelofs:
“In July we announced the acquisition of Cott’s bottling activities transforming Refresco into the world’s largest independent bottler. In combining the two companies we create nationwide coverage in the US – the largest single soft drinks market globally – while adding significant capacity and extending our broad product portfolio in the UK. This acquisition lies at the heart of our buy & build strategy and is a perfect fit with Refresco’s current activities. It taps into the expected private label growth in the US enabling us to support further growth of our core customers and it creates a US national platform for contract manufacturing. We look forward to presenting this exciting new development to shareholders for their approval at the Extraordinary General Meeting on September 5, 2017.
“Looking back at the second quarter results we are pleased to report strong volume growth in Europe and the US driven by acquisitions and organic growth. On a like-for-like basis volume in retail brands remained stable and contract manufacturing for A-brands was up double digit. Gross profit margin per liter was in line with our expectations. Volume fluctuations in the quarter and significant startup costs of recently installed production lines affected our results.”
Download: Refresco reports Q2 2017 results
[1] Based on US GAAP.
[2] Based on US GAAP.
[3] Change percentages and totals calculated before rounding.
JBT Corporation, the global technology solutions provider to high-value segments of the food and beverage industry, has announced the acquisition of UK-based PLF International Limited (PLF), a specialist manufacturer of filling machines for the fast-growing global powder product market. With demand increasing worldwide for powdered products, especially for powdered infant formula and nutraceuticals, the acquisition will enable JBT to bring PLF fillers – which combine with JBT’s own seamers – to a much wider marketplace.
Since 1994, PLF International has designed and manufactured what is considered to be one of the most flexible, user-friendly powder filling machines in the world. PLF’s range of filling machines are all built to facilitate the stringent demands of the food, beverage, cosmetics and pharmaceutical industries, being easy to clean with minimum giveaway and gentle product handling. They can be semi or fully automatic and are built so performance can be enhanced to meet production demands.
“JBT and PLF have collaborated on numerous, successful projects over the past 10 years,” said Tom Giacomini, Chairman, President and Chief Executive Officer. “Specifically, customers have purchased PLF fillers and JBT closers as part of an integrated solution. Adding PLF’s expertise and complementary products to Liquid Foods provides a valuable extension to our portfolio. Additionally, we can expand PLF’s business geographically and strengthen its aftermarket opportunities.”
“PLF provides a unique filler that is an improvement on most of the competition as there is very little product giveaway,” explained Carlos Fernandez, President and Managing Director of JBT’s Liquid Foods business. “PLF’s filler and ancillary products can be used in conjunction with JBT’s closer to complete an integrated line solution, so this is a very complementary acquisition for us, which will also give us access to the fast-developing powdered product market.” PLF Managing Director Mark Emond commented: “We were seeking a long-term steward for PLF going forward and feel comfortable that in JBT we have the ideal partner given that we have worked so well together in the past. With JBT’s focus on innovation, technology and customer care, we are leaving our business in the best possible hands.”
As well as powdered infant milk, the integration of PLF will also open the door for JBT to enter the powdered nutraceutical and added vitamin drink segment; a market that will again complement JBT’s existing business, Fernandez added.
AROL SpA – global point of reference in the design, production and distribution of capping and corking systems – has finalized, on July 21, 2017, the acquisition of UNIMAC-GHERRI, specialist in the production of filling and capping of glass containers with twist-off caps.
The acquisition of UNIMAC-GHERRI confirms the industrial project and the growth strategy of the Group – of which is also part FT System, specialized in non-destructive inspection and quality control both in line and in laboratory – which has the objective of expanding its offer, integrating it with high-tech machines with the aim to guarantee consumer protection.
In fact, AROL designs tailor-made solutions for food, beverage, wine & spirits, household care, personal care, pharmaceutical and chemical sectors. With FT System, the AROL group counts on more than 600 specialists and 14 operational branches in 4 continents. It manufactures over 700 closing systems and more than 500 control systems a year, with over 26.000 machines installed in the world.
“We are particularly pleased to have enriched our offer to our customers with the machines produced by UNIMAC-GHERRI, from over 30 years synonymous of quality and reliability in twist-off closures”, said Alberto Cirio, CEO of AROL SpA. “Thanks to the integration in AROL, we will be able to expand our commercial presence and after-sale all over the world, as well as to carry out quickly the important innovations to develop our systems and implement the digital transformation as required by the ultimate packaging installations”, said Renzo Tavaroli, CEO of UNIMAC-GHERRI.
Boxmore Packaging, with headquarters in Johannesburg, South Africa, will become a fully owned subsidiary of the Austrian packaging specialist ALPLA
ALPLA, a leading provider of plastic packaging worldwide, has bought an African market leader in the form of Boxmore Packaging. The company, headquartered in Samrand, Johannesburg, specialises in PET pre-forms, PET bottles and closures, and currently employs around 1,000 members of staff at nine locations.
‘The African continent is an attractive growth market for us. With the purchase of Boxmore Packaging, we now also have a broad basis for entering the market in South Africa, in addition to our activities with ALPLA TABA in North Africa’, says ALPLA CEO Günther Lehner. ALPLA has acquired 100 % of Boxmore Packaging. All employees and locations are being taken on by ALPLA, although it has been decided that the management structure will remain the same. The current board, under the leadership of Len Engelbrecht (Boxmore CEO), will continue to manage the existing Boxmore business, and in addition, take on responsibility for the integration and management of the existing ALPLA SA business. For the foreseeable future the company will continue to operate under the existing name as a member of the ALPLA Group.
Leaders in South Africa
Founded in 1995, Boxmore Packaging is seen as the market leader for PET pre-forms and bottles (ISBM technology), as well as closures, in southern Africa. Its headquarters are located in the industrial zone of Samrand near the South African city of Johannesburg. Around 1,000 employees currently manufacture approximately 4 billion of the aforementioned products each year at nine production locations. The customers of Boxmore Packaging are situated in more than 20 African countries, as well as on the islands in the Indian Ocean.
‘Both the products and customer structure of Boxmore Packaging suit our corporate structure very well’, emphasised Christoph Riedlsperger, ALPLA’s Regional Director for Africa, Middle East and Turkey. The active customer base includes numerous international consumer goods companies and long-term customers of ALPLA, but also local customers previously unknown to ALPLA. ‘With this acquisition, the biggest in the history of the company, we are taking a significant step towards our targets on the African continent,’ says Günther Lehner.
Len Engelbrecht is delighted with this strategic partnership saying, “Our combined ambition to prioritise growth in Africa is a very exciting opportunity and one that we’ll be exploring through Boxmore’s current footprint, and existing relationships in Sub-Saharan Africa.”
The takeover was signed on 5th of July 2017, implementation remains subject to the required legal and regulatory approval by the competition authorities. The contract parties have reached a confidentiality agreement regarding the financial details.
