Ball Announces Agreement to Sell Aerospace Business for $5.6 Billion
- The sale of the aerospace business will provide Ball Corporation with $5.6 billion in cash.
- The transaction represents 19.6x Ball Aerospace's LTM comparable EBITDA.
- The company plans to use the proceeds to reduce net debt and accelerate capital return to shareholders.
- Ball Corporation will focus on its packaging operations and low-carbon aluminum packaging initiatives.
- None.
- Price represents 19.6x Ball Aerospace's LTM comparable EBITDA (as of June 30, 2023)
- Net proceeds accelerate deleveraging, share repurchases and drive significant EVA® accretion
- Creates a focused, high-margin global aluminum packaging leader
- Enables acceleration of low-carbon, best-value aluminum packaging initiatives to enhance organic growth across global packaging operations
- BAE Systems well-positioned to invest in Ball Aerospace in excess of our existing plan
Following the successful close of the transaction announced today, the combination of roughly half of the after-tax proceeds of approximately
"Since 1956, generations of dedicated Ball Aerospace colleagues have transformed a business of humble beginnings into a thriving enterprise offering innovative capabilities in a world that needs rapid, scalable technology solutions. In recent years, the business has positioned itself to have an even greater contribution to customers' missions and delivered fourfold growth and record levels of combined contracted and won-not-booked backlog. The complementary cultural fit of Ball Aerospace and BAE Systems and their combined position as a pure play aerospace and technologies company will leverage Ball's recent investments in talent and facilities located across the country and centered in
Ball Corporation will utilize its share repurchase authorization programs and quarterly dividends to accelerate the return of value to shareholders. The precise timing and amount of repurchases and the opportunity to increase the dividend payout will be determined based on market conditions, timing of receipt of proceeds and other factors.
"Following the successful closing of today's transaction, Ball Corporation's improved balance sheet strength and flexibility, highly cash generative packaging businesses and our team's cost-efficient ownership mindset provide an excellent equation for increasing the return of value to shareholders, maximizing value from our existing operations, and investing in our future growth through the lens of EVA. Executing our strategy of enabling the greater use circular aluminum packaging on a global scale continues. Our acceleration of low-carbon, best-value aluminum packaging initiatives in the years to come will stimulate organic growth across our global packaging operations and improve the world for future generations. Our innovative portfolio of aluminum cans, bottles and cups for single-serve, refill, reuse and recloseable applications has untapped potential, and we look forward to unlocking that value and delivering sustainable compounding shareholder growth now and beyond," said Fisher.
Ball Corporation will host a webcast today, Thursday, August 17, 2023, at 9 a.m. Mountain time (11 a.m. Eastern) to discuss the transaction announcement. Please use the following URL https://edge.media-server.com/mmc/p/tayag4wm for the webcast. For those unable to listen via webcast please use the following dial-in numbers to listen to the live call: 800-954-0643 (toll-free) or +1 212-231-2934 (international callers). A webcast replay and a written transcript of the event will be posted within 48 hours of the event's conclusion to Ball Corporation's website at www.ball.com/investors, under "news and presentations."
Morgan Stanley & Co. LLC is serving as Ball Corporation's financial advisor. Skadden, Arps, Slate, Meagher and Flom LLP and Axinn Veltrop and Harkrider LLP are serving as Ball Corporation's legal and regulatory advisors for the proposed transaction.
About Ball Corporation
Ball Corporation supplies innovative, sustainable aluminum packaging solutions for beverage, personal care and household products customers, as well as aerospace and other technologies and services primarily for the
Forward-Looking Statements
This release contains "forward-looking" statements concerning future events and financial performance. Words such as "expects," "anticipates," "estimates," "believes," and similar expressions typically identify forward-looking statements, which are generally any statements other than statements of historical fact. Such statements are based on current expectations or views of the future and are subject to risks and uncertainties, which could cause actual results or events to differ materially from those expressed or implied. You should therefore not place undue reliance upon any forward-looking statements, and they should be read in conjunction with, and qualified in their entirety by, the cautionary statements referenced below. Ball undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Key factors, risks and uncertainties that could cause actual outcomes and results to be different are summarized in filings with the Securities and Exchange Commission, including Exhibit 99 in Ball's Form 10-K, which are available on Ball's website and at www.sec.gov. Additional factors that might affect: a) Ball's packaging segments include product capacity, supply, and demand constraints and fluctuations and changes in consumption patterns; availability/cost of raw materials, equipment, and logistics; competitive packaging, pricing and substitution; changes in climate and weather and related events such as drought, wildfires, storms, hurricanes, tornadoes and floods; footprint adjustments and other manufacturing changes, including the startup of new facilities and lines; failure to achieve synergies, productivity improvements or cost reductions; unfavorable mandatory deposit or packaging laws; customer and supplier consolidation; power and supply chain interruptions; changes in major customer or supplier contracts or loss of a major customer or supplier; inability to pass through increased costs; war, political instability and sanctions, including relating to the situation in
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SOURCE Ball Corporation
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