Silgan Holdings will acquire Graham Packaging in a cash and stock transaction valued at $19.56 per share or $4.1 billion. The deal is expected to close in the second half of 2011.
Graham Packaging has been a leader in the automotive lubricants packaging market since the industrys conversion to plastic packaging more than 25 years ago. According to its web site, Graham provides blow-molded plastic containers for numerous lubricant brands, such as BPs Castrol, Chevron, Citgo, ExxonMobil, Ashlands Valvoline, and Shell (including Pennzoil, Quaker State and Shell).
Graham has a 74 percent share of the automotive lubricants packaging market, according to the companys presentation at the Credit Suisse Global Paper & Packaging Conference in February 2011.
Silgan supplies of metal containers in North America and Europe, and supplies metal, composite and plastic vacuum closures for food and beverage products globally. It also supplies plastic containers for personal care products in North America.
Silgan also has some history of designing and manufacturing bottles for lubricants products. For example, it co-developed and manufactured a handled quart motor oil bottle for Pennzoil in 2002.
The combined company will have more than 17,000 employees in 19 countries through a network of 180 plants and have annual sales topping $6.2 billion. Silgan operates 83 manufacturing sites globally, including 58 in the United States. Graham has 97 manufacturing facilities globally, including 73 in the United States.
Silgan reported full year 2010 net income of $144.6 million, or $1.89 per diluted share, on net sales totaling $3.1 billion. For 2010, Graham posted net income of $61.8 million, or 89 cents per diluted share, with net sales of $2.5 billion.
By press time, Graham Packaging and Silgan Holdings did not respond to Lube Reports requests for comment.