SA firm buyout Nigeria’s Alucan for $301m

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Andrew+Marshall+XXX+high+resJohannesburg Stock Exchange-listed Nampak, a leading South African packing company, has bought Alucan Packaging, a beverage-can operation in Nigeria, funding the deal through existing cash resources and debt facilities.  The SA company, Africa’s largest packaging group, also said on Monday it had been granted an option to acquire a leading rigid plastics company in Nigeria. The total value of the investments is $301m.

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The metal, glass, paper and plastic packaging maker’s share price was up 3.48% in mid-morning trade on Monday. Nampak said the Alucan factory was equipped with a new, state-of-the-art aluminium beverage-can line capable of producing up to 1-billion cans a year.

It has in the past few years set up a beverage-can production line of similar size in Luanda, Angola’s capital.

The Nigerian plant has been designed to accommodate a second line once demand exceeds existing capacity.

The business is situated in the Agbara industrial area, close to Nigeria’s commercial capital, Lagos, and near major beverage producers. It also has a reliable source of gas that will be used for heating and power generation, Nampak said.

“This acquisition will significantly increase Nampak’s presence in Nigeria, which is Africa’s second-largest economy and where we already manufacture food and general cans in our factory in Lagos,” Nampak CEO Andrew Marshall said on Monday.

Nampak also produces cigarette cartons, food cartons and labels at its factory in Ibadan, 120km north of Lagos.

Beverage-can manufacturing is a core business for Nampak. Nigeria, with a population of more than 150-million, has seen growth in demand for beverage cans and this is expected to continue, it said.

Plastic packaging is also a core business for the group, throughout Africa and in the UK. It operates in 12 African countries, generating R2.5bn in annual revenue.

“(The Nigerian) acquisition and the potential to acquire the plastics company will further contribute to our stated growth strategy in the rest of Africa,” Mr Marshall said.

The transaction is subject to the fulfilment of certain conditions, including South African Reserve Bank approval.

Babatunde Akinsola
Babatunde Akinsolahttps://naija247news.com
Babatunde Akinsola is aNaija247news' Southwest editor. He's based in Lagos and writes on the Yoruba Nation political issues, news and investigative reports

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