Owens-Illinois (O-I) has entered into a joint venture with Thailand’s Berli Jucker Public (BJC) to expand its presence in China and Southeast Asia. The venture has also entered into an agreement to purchase Fraser & Neave’s Malaya Glass operations, which include plants in China, Thailand, Malaysia and Vietnam.
The four Malaya Glass plants employ approximately 1,900 people and produce containers for the beer, non-alcoholic beverage and food markets.
In the transaction, the O-I and BJC joint venture purchased Malaya Glass for $221.7 million after consideration of debt and minority interests. O-I’s portion of the purchase price was $132.4 million. Following the acquisition, the operations in Malaysia and Vietnam will be split evenly between O-I and BJC. The acquired interest in the Chinese plant will be managed as part of O-I China’s existing operations. BJC will assume majority ownership of the Thai operation.
“This acquisition is aligned with our strategic objectives to seek a leadership position in China and Southeast Asia,” said O-I chairman and CEO Al Stroucken. “The plant in Sichuan expands our presence in China, and the joint venture offers us an instant competitive position in the important growing markets of Vietnam and Malaysia. We expect to see an immediate positive impact on our earnings as a result of this acquisition.”
O-I has previously announced plans to grow through strategic acquisitions and joint ventures in regions with rapidly growing markets. In March, the company announced its entrance into the Argentinean market with the acquisition of a majority share in Cristalerias Rosario.
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