Stock Symbol: TSX - CCL.A and CCL.B
TORONTO, Oct. 4 /CNW/ - CCL Industries Inc., a world leader in specialty
packaging and labelling solutions for the consumer products and healthcare
industries, announced today it has signed an agreement to sell its 40%
interest in its European joint venture, ColepCCL, Embalagens e Enchimentos
S.A. to its majority partner, RAR - Sociedade de Controle (Holding), S.A.,
based in Portugal.
CCL's merger with COLEP in 2004 created the largest European contract
manufacturer of personal care, household and pharmaceutical products. In 2006,
CCL's proportional share of ColepCCL's sales was $182.7 million and the joint
venture contributed $18.0 million of earnings before interest and taxes and
$25.5 million in EBITDA to CCL's financial results.
CCL will receive approximately $140 million in cash, 50% payable on
closing with the balance to be paid at the end of February 2008 for its
interest in the joint venture, which, including dividends received, will
nearly double CCL's return on its original investment. ColepCCL will retain
all of the net debt in the business upon closing. CCL's current share of the
net debt is approximately $28 million. The transaction is expected to close by
the end of November and is subject to normal regulatory approvals.
Donald G. Lang, Vice Chairman and Chief Executive Officer of CCL
Industries Inc. said, "RAR has been an excellent joint venture partner over
the last three and a half years and together, we have benefited from the
success of the business. ColepCCL's management team has met all of our
expectations by achieving the synergies that were identified at the time of
the merger and growing the business." Mr. Lang also commented that "ColepCCL
has many opportunities for both internal growth and acquisitions; however,
upon evaluating our own growth opportunities, we have decided to focus our
investment dollars in the businesses that we control.
"Over the last five years, CCL has consistently delivered improved
results with focused strategic capital investments in our core businesses and
bolt on acquisitions at CCL Label, which have met our financial hurdles. We
now have greater flexibility with this process and can accelerate building the
great franchises in our portfolio, which now make CCL a pure global specialty
CCL manufactures pressure-sensitive, shrink sleeve and in-mould labels,
aluminum containers and plastic tubes for leading global companies in the home
and personal care, healthcare and specialty food and beverage sectors. With
headquarters in Toronto, Canada, CCL Industries employs approximately 5,000
people and operates 49 production facilities in North America, Europe, Latin
America and Asia.
Statements contained in this Press Release, other than statements of
historical facts, are forward-looking statements subject to a number of
uncertainties that could cause actual events or results to differ materially
from some statements made.
For further information:
For further information: Steve Lancaster, Executive Vice President and
Chief Financial Officer, (416) 756-8517; For more details on CCL, visit our
website - www.cclind.com