Beverage, food and household products packaging supplier Ball has signed an agreement to acquire Envases del Plata, an extruded aluminium aerosol packaging producer with a manufacturing facility in San Luis Potosi, Mexico, for an undisclosed sum.
Ball will form a new joint venture (JV) in Argentina that will combine both the companies' aerosol packaging operations in Argentina and in Brazil.
The new JV, Envases-Ball, will include Ball's steel aerosol can plants in Buenos Aires and San Luis, Argentina, and Envases' extruded aluminum packaging plants in the same locations as well as one in Manaus, Brazil.
Ball president and chief executive officer John Hayes said the actions were in line with the company's 'Drive for 10' approach to increase its geographic reach and expand into new products and capabilities.
"The acquisition in Mexico will provide a platform to grow our North American extruded aluminum packaging business, and in Argentina the new joint venture will leverage the combined strengths of Ball's steel aerosol can business in Argentina with Envases' extruded aluminum aerosol business in Argentina and Brazil," Hayes said.
The San Luis Potosi plant operates five manufacturing lines and produces extruded aluminium aerosol cans for personal care and household products, to serve customers in North, Central and South America.
Following the acquisition, the plant will become part of Ball's food and household products packaging division, Americas, and will complement the company's existing aluminium aerosol business in Europe, Ball Aerocan, and the North American extruded aluminium aerosol slug business that was acquired by Ball in 2010.
The acquisition, which is expected to close by the end of October 2012, provides Ball with a new end market for its products including the company's ReAl technology that allows the use of recycled material and lightweighting in the making of extruded aluminium packaging.
Envases will have a 75% share of the JV and Ball, which will have 25%, will provide technical and other assistance to the business. Under the terms of the agreement Ball can elect to acquire or exit the JV in the future.