CCL Industries, a world leader in developing manufacturing, packaging and labelling solutions for the consumer products industry, has announced that it has sold four non-core business units in its Container Division.
The company has sold three North American business, together with an operation in Costa Rica. These include CCL's aluminum tube plant in Harrisonburg, Virginia, the laminate tube facility in Swedesboro, New Jersey, the plastic jar plant in Plattsburgh, New York and the San Jose, Costa Rican facility that manufactures a variety of containers for the Central American market.
The purchaser is a private Ontario limited partnership, 50 per cent owned by Douglas Brent, Hollis Brent and Gary Ullman, and 50 per cent owned by CCL, and will operate under the name of IntraPac. Ullman, a former senior executive of CCL, will be the president and chief executive officer.
CCL will receive proceeds of approximately C$74 million (€49.4m) in cash and C$13 million in equity of IntraPac L.P. In addition, CCL will be entitled to additional consideration should future performance exceed specified benchmarks. These businesses, in 2002, accounted for approximately C$119 million, $21.4 million and $11.3 million in sales, EBITDA and operating income respectively. This disposition will result in a loss of approximately CD$6 million after tax and will be recorded as an unusual item in the third quarter ending September 30, 2003. The purchaser has the option to acquire CCL's residual equity in the partnership. CCL will carry its 50 per cent interest as an equity investment.
Donald Lang, president and chief executive officer of CCL Industries said: "CCL is now focused on three great business franchises with the resources to support further growth and profitability improvement through capital reinvestment and by acquisition as seen in our announcement of 22 July 2003 regarding the acquisition of Avery Dennison's European label converting business. We anticipate the Avery Dennison transaction will be completed by the end of September." Lang also commented that "the net earnings impact of this acquisition and the divestiture of these non-core assets will be positive to CCL".
CCL Industries , provides state-of-the-art packaging solutions, including specialty aluminium and plastics packaging and innovative product labelling, to some of the world's largest producers of consumer brands, helping them to get their products to market quickly and cost-effectively. CCL develops solutions for producers of leading consumer brands in personal care, cosmetic, pharmaceutical, household and specialty food products. With headquarters in Toronto, Canada, CCL employs 7,000 people and operates 35 production facilities in North and Central America and Europe.