O-I buys glass packaging facility in Mexico from Grupo Modelo for US$188m

USA – The glass packaging manufacturer, Owens-Illinois, Inc. has agreed to acquire glass packaging manufacturing facility, Nueva located in Mexico from Grupo Modelo, a wholly owned affiliate of Anheuser-Busch InBev.

With four furnaces, the facility has the capacity to produce and supply approximately 300,000 tons of glass containers annually for Grupo Modelo brands, which include Corona, Modelo Especial and Pacifico.

O-I expects the business to contribute approximately US$140 million of revenue and US$40 million EBITDA on an annual basis through increased synergies.

As part of the agreement, O-I has entered into a long-term glass supply agreement to continue to supply Grupo Modelo.

“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,” said Andres Lopez, Chief Executive Officer, O-I.

“This investment is in addition to our recently announced nearly 50 percent 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.”

O-I in November last year, acquired a 49.7% stake in glass packaging producer Empresas Comegua from Fabricación de Màquinas for approximately US$119 million.

It provides O-I with a wide product range including glass packaging solutions for clients in the food, soft drinks, beer, spirits and pharmaceutical industries in the Central American and Caribbean markets.

The company last month announced plans to invest more than US$60 million to expand its plant in Gironcourt, France, as it responds to growing consumer demand for sustainable glass packaging.

Plans include building a new furnace and will focus on the growing premium beer segment.

The investment will allow the company to produce bottles in three colours and in sizes ranging from 0.2-litres to Magnum-size.

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