Beta Glass Plc
Frigoglass S.A.I.C, the Athens, Greece-based company has reversed the planned sale of Beta Glass Plc to GZI Mauritius Limited (GZI). Frigoglass S.A.I.C is the parent company of Frigoglass Nigeria Limited, which is a core investor in Beta Glass Plc.
Following Frigoglass’ decision to divest from glass business, the company had signed an agreement with GZI Mauritius Limited on May 21, 2015.
However, Frigoglass yesterday announced the termination of the agreement with GZI Mauritius Limited.
In a filing with the Nigerian Stock Exchange (NSE), the company said a condition precedent was not met as GZI did not secure the necessary level of debt financing for the acquisition.
The company said: “Amended offers made by GZI were declined as not reflecting the full value of the glass business and therefore not being in the best interest of Frigoglass and its stakeholders. Frigoglass’ glass business retains its strong local market position and technical excellence,”.
Frigoglass added that it believed that it will remain the leading glass packaging manufacturer in Nigeria and is ideally placed to capitalise on the long-term beverage consumption growth in Africa, driven by its customers’ sustained investments and the continent’s attractive growth prospects.
“The glass business continues to perform well and remains a valuable asset for Frigoglass, despite challenging trading conditions in Nigeria. During 2015, the glass business delivered on its business plan and successfully completed a furnace rebuild in Nigeria, enhancing its efficiency and capacity.
Frigoglass is working with its key stakeholders and a team of highly reputable advisors to determine its next strategic steps, identify initiatives to preserve the value of the business for all stakeholders and achieve an optimal capital structure,” the firm said.
Frigoglass was expecting to receive a net cash consideration of $225 million for the sale of the glass operations. The enterprise value was put at $403 million. Frigoglass will receive $200 million in cash immediately after the completion of the transaction and will subsequently receive $25 million in two tranches over the following two years.
The glass operations that ought to be sold included Frigoglass’ glass container operations in Nigeria and Dubai as well as the complementary plastic crates and metal crown businesses in Nigeria. Frigoglass has also reached agreement to acquire the minority interest in its Frigoglass Jebel Ali business in Dubai, which will also be part of the transaction.