Ball’s combined global metal beverage business now operates 75 metal beverage manufacturing facilities and joint ventures, as well as various support locations, in North and Central America, Europe and Russia, South America, Asia and the Middle East. The existing metal food, aerosol and aerospace operations further complement the company’s business portfolio.
Ball now employs 18,700 people across five continents with pro forma net 2015 sales of approximately $11 billion. The company’s global headquarters will remain in Broomfield, Colorado. The closure of the Rexam headquarters based in London is expected as soon as the relevant functions required to support the combined group have been transferred. It is currently expected that this will be achieved by the end of 2016.
“We’re delighted to move forward together as a leader in the packaging industry, supplying approximately 100 billion innovative, high-quality metal beverage containers from the world’s most efficient manufacturing footprint,” said John A. Hayes, chairman, president and CEO. “We will immediately begin integrating the new business into our global metal beverage operations, maintaining a focus on Ball’s existing Drive for 10 vision, EVA philosophy, balance sheet management, free cash flow generation and capital allocation practices. Through this shared approach, we will drive in excess of $300 million in synergies by the end of the third year of combined operations.”
Scott C. Morrison, senior vice president and chief financial officer, said the company was pleased with the financings it completed in conjunction with the acquisition and, following the deal-related cash outflows, leverage in the range of 4.5 times net debt to comparable EBITDA reflects the mid-year seasonal peak of borrowings, as well as the impact of the acquisition, synergies and net divestiture proceeds.
“Our execution on synergies and combined strong free cash flow will allow us to deleverage rapidly,” he said. “We target our leverage to be in the range of 3.0 times in 2018, at which time we currently expect to re-initiate our share repurchase program.”