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Owens-Illinois: EUR 61.5 million in synergies with BSN

Owens-Illinois Inc. expects the purchase of BSN Glasspack SA, Europe“s second-largest glass-container maker, to lead to EUR 61.5 million in annual synergies, the US glass packaging giant told senior …

Owens-Illinois Inc. expects the purchase of BSN Glasspack SA, Europe“s second-largest glass-container maker, to lead to EUR 61.5 million in annual synergies, the US glass packaging giant told senior lenders in a presentation on 20 February 2004. To achieve the synergies, Owens-Illinois said it expects to spend EUR 42.2 million in one-time costs and EUR 11 million in incremental capital expenditures. A team of Owens-Illinois executives and operational personnel considers the base synergy estimate to be “very achievable” and consistent with experience with other consolidation transactions, according to a SEC filing. Longer-term synergies may also be achievable based on Owens-Illinois“ performance metrics, the company said but incremental capital spending and longer lead times would be required. On 18 February 2004, Owens-Illinois said it planned to buy Europe“s BSN Glasspack in a USD 1.46-billion deal that includes the assumption of USD 835 million in debt. The purchase would make the company the largest glass container maker on four continents and emphasise its focus on the bottle-making business, Owens-Illinois said.

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