Owens-Illinois Inc. officials furnished more details about a potential blockbuster sale of almost all the company's blow molding operations during a July 21 earnings conference call and said the deal could be imminent.
The sale, to an undisclosed buyer, would encompass the vast majority of O-I's blow molding operations for containers, said Chairman and Chief Executive Officer Steven McCracken. Those operations, including PET and high density polyethylene bottles, generate about $1 billion in annual sales, he added.
The Toledo, Ohio-based packaging giant primarily will focus on its sprawling glass business, which has more than $4 billion in sales.
But O-I will not sell its blow molding business for health-care products. Instead, the company will merge those operations with its plastic closures and injection molded pharmaceutical products, McCracken said. The plastics businesses to be retained generate about $700 million in annual sales, McCracken said. Blow molded health-care products include plastic syringes and vials.
For accounting purposes, the blow molding businesses that are targeted for sale will be considered discontinued operations beginning in the third quarter of 2004, McCracken said. Those operations include custom PET and HDPE bottles for consumer, food and noncarbonated beverage products.
Several outside sources have said that O-I plans to sell those operations to New York-based equity firm Blackstone Group. Blackstone then would integrate those operations with Graham Packaging Co. LP, a bottle blow molder in York, Pa., also owned by Blackstone, those sources said. Neither O-I nor Graham have confirmed the rumors.
O-I, a publicly held company, first said in April that it would sell its blow molding businesses.