Muncie, Ind.-based Ball Corp. has signed a $73 million agreement with Lam Soon Ltd. of Hong Kong to acquire Lam Soon's controlling interest in M.C. Packaging Ltd. The agreement will move Ball into the high density polyethylene market for the first time. M.C. Packaging, based in Hong Kong, had sales of $195 million last year. It has a plant in Hong Kong and 13 in China.
The company makes HDPE bottles for motor oil, edible oils and personal-care products; and aluminum and steel cans.
Although the plastic segment is small - only about 10 percent of M.C. Packaging's total sales-Ball considers that segment important, said Harold Sohn, vice president of corporate relations. And although Ball had focused its efforts on PET bottle production, it will keep the new HDPE bottle business. He did not know if Ball will make a larger move into HDPE products.
The deal, which comes just a week after Ball announced its acquisition of blow molder Brunswick Container of East Brunswick, N.J., is expected to close early next year.
The M.C. Packaging acquisition is being made through Ball's Hong Kong-based subsidiary, FTB Packaging Ltd. FTB operates seven metal can-making plants in China. Ball will own 52 percent of M.C. Packaging; the rest is owned by Ng Jung Hong of China. Ball said it also will make a general offer to acquire outstanding public shares of M.C. Packaging. If all public shares are tendered, Ball expects to own directly and indirectly about 74 percent of M.C. Packaging.
The transaction ``advances one of our key strategies, which is to expand our international packaging presence,'' George A. Sissel, Ball president and chief executive officer, said in a press release.
Ball reported sales of $2.6 billion last year. The firm has three U.S. PET plants and a fourth under construction, in addition to the two it is acquiring from Brunswick.