Ardagh bids to entice US investors

IRISH packaging group Ardagh has embarked on a US investor roadshow, aimed at raising acquisition funds.

The glass and bottling specialist, which has in recent times expanded into can and aluminium packaging, has two bond offers on the table for potential US investors, covering a combined $410 million (€322m) worth of senior notes in the firm.

The proceeds will chiefly go on covering the costs of recent acquisitions — earlier this month, Ardagh reached agreement to buy the Boxal group of companies for around €85m — and repaying debt.

However, the money could also cover new acquisitions, with Ardagh announcing, yesterday that it is close to making two further purchases.

“We are presently in advanced discussions with the relevant vendors for the potential acquisitions of two other unrelated businesses, which are active in the sectors in which we operate,” management said.

It added, however, that “there can be no assurance” that the Boxal acquisition will be completed. That deal remains subject to certain closing conditions. Boxal comprises the European operations of the US-based Exal Corporation, and is a leading international player in the area of aluminium-based packaging, one of the growth segments in the international packaging sector.

“We cannot provide any assurance that the Boxal acquisition will be completed or that either of the other potential acquisitions will be contractually agreed and, if so agreed, will be completed,” the company said.

Ardagh’s revenues have increased fivefold in the last five years. It said yesterday that revenue outlook for the fourth quarter of 2011 is for numbers “broadly in line” with those of a year earlier, which amounted to over €870m. It added that EBITDA for the quarter is likely to be lower by a single digit percentage on a year-on-year basis.

Much of Ardagh’s recent growth has been on the back of strategic acquisitions. In the past two years it has also acquired Italian packaging business Finanziaria di Partecipazioni Industriali for €125m and Impress, the second largest can manufacturer in Europe, for €1.7m, a deal the Irish company hailed as being “transformational”.