6 November 2019
SIG Combibloc Group ("SIG")
SIG to acquire Visy Cartons in Australia
SIG has reached agreement to acquire Visy Cartons Pty Ltd ("Visy Cartons") from VisyPak Operations Pty Ltd, a subsidiary of Pratt Consolidated Holdings Pty Ltd, for AU$70 million (around EUR43 million at current exchange rates), subject to customary conditions being met. Pratt Consolidated Holdings Pty Ltd is a privately owned Australian company operating in the packaging, paper and recycling industries. Visy Cartons will become part of SIG's business in the Asia Pacific region.
Visy Cartons has for many years produced SIG aseptic cartons under licence from SIG for sale in the Australia and New Zealand markets. The company generated revenue of AU$84 million (around EUR52 million) in its fiscal year ending June 2019, of which approximately 80% was from the sale of SIG aseptic cartons with the remainder from fresh milk cartons that are not covered by the SIG licence arrangement. Visy Cartons is one of the leading players in the Australian beverage carton market, placing filling machines with customers under long-term contracts supported by a strong local service organisation. There is scope to expand the business to New Zealand where Visy Cartons currently has a very limited presence.
The acquisition will be funded through cash balances and existing credit facilities. The profitability of Visy is expected to increase with the realisation of significant synergies, arising from supply chain optimisation and access to SIG's latest technologies and solutions.
The overall Australia and New Zealand market for aseptic beverage cartons is projected to grow at around 3% CAGR over the next five years, driven mainly by investments in dairies for the export of aseptic milk to China and other Asian countries. The acquisition of Visy Cartons will enable SIG to further support its existing customers in Asia who have invested into or partnered with players in Australia and New Zealand. SIG's aseptic carton technology is the ideal packaging solution for the export of liquid dairy products, offering long shelf life, efficient logistics and differentiation potential. In China in particular, demand for premium milk imported from Australia and New Zealand is expected to grow by around 7% CAGR over the next five years. SIG is already strongly positioned in the Chinese market, with an expanding local manufacturing presence and a newly opened regional Tech Centre.
Commenting on the agreement, Lawrence Fok, President and General Manager of SIG Asia Pacific said: "We are very pleased to welcome the management and employees of Visy Cartons to SIG after many years of collaboration. Visy has an excellent team with a proven track record and together we will work to ensure that customers in Australia and New Zealand enjoy excellent service and access to our leading technologies. We plan to leverage our broad product portfolio to tap into the New Zealand market."
Adam Lipscomb, who will remain General Manager of Visy Cartons, said: "We are delighted at becoming a member of the SIG family and are looking forward to pursuing growth opportunities from a strengthened position with expanded product and geographic opportunities."
The transaction is expected to close during the fourth quarter of 2019.
Jennifer Gough +41 52 674 6508
Director Investor Relations
SIG Combibloc Group AG
Neuhausen am Rheinfall, Switzerland
Andreas Hildenbrand +41 44 202 5238
SIG is a leading systems and solutions provider for aseptic carton packaging. We work in partnership with our customers to bring food and beverage products to consumers around the world in a safe, sustainable and affordable way. Our unique technology and outstanding innovation capacity enable us to provide our customers with end-to-end solutions for differentiated products, smarter factories and connected packs, all to address the ever-changing needs of consumers.
Founded 1853, SIG is headquartered in Neuhausen, Switzerland. The skills and experience of our approximately 5,000 employees worldwide enable us to respond quickly and effectively to the needs of our customers in over 60 countries. In 2018, SIG produced more than 35 billion carton packs and generated EUR1.7 billion in revenue. For more information, visit www.sig.biz.
Disclaimer & Cautionary Statement
This media release may contain "forward-looking statements" that are based on current expectations, assumptions, estimates and projections about us and our industry. Forward-looking statements include, without limitation, any statement that may forecast, indicate or imply future results, performance or achievements, and may contain the words "may", "will", "should", "could", "continue", "believe", "anticipate", "expect", "assume", "estimate", "intend", "project", "plan", "will likely continue", "will likely result", or words or phrases with similar meaning. Undue reliance should not be placed on such statements because, by their nature, forward-looking statements involve known and unknown risks and uncertainties, including, without limitation, economic, competitive, legal, financial and technological factors outside of the control of SIG Combibloc Group AG ("SIG" or the "Company" and together with its subsidiaries, the "Group"), that may cause SIG's business, financial condition, strategy, actual results or prospects to differ materially from the forward-looking statements (or from past results). SIG does not undertake any obligation to revise or update any forward-looking statement, whether to reflect any new circumstances, information or future events or otherwise.
This media release is not a guide to future performance or an offer or a recommendation to buy, sell or hold securities.