Canadian PE firm Onex to acquire Swiss carton maker SIG Combibloc for $4.66 bn

Canadian private equity firm Onex Corp yesterday struck a deal to acquire SIG Combibloc Group, the world's second-largest maker of drink cartons, for as much as $4.66 billion (€3.75 billion).

Under the terms of the deal, Onex will pay $4.44 billion (€3.575 billion) at the closing of the transaction, and up to $2.17 million (€175 million) based on the financial performance of SIG in 2015 and 2016. Onex expects the transaction to close in the first quarter of 2015, subject to regulatory approvals.

The terms also include an equity investment of around $1.25 billion (€1.01billion) by Onex Partners IV, and co-investors, including Onex, and SIG's management team.

SIG was acquired by New Zealand's richest man Graeme Hart's Rank Group subsidiary Reynolds Group Holdings in 2007 for $2.3 billion, which put it up for sale early this year to reduce its $18 billion debt accumulated through leveraged buyouts.

Reynolds Group, which also owns other plastics packaging companies including Closure Systems International, had in September said that it had selected private equity firms Onex, Bain and Partners, CVC and BC Partners for the second round of bidding.

Closure Systems has also been reportedly put up for sale by Reynolds Group, according to media reports.

SIG is the second largest provider of aseptic carton packaging globally. Based in Neuhausen am Rheinfall, Switzerland, SIG provides beverage and food producers with aseptic carton sleeves and closures, as well as the filling machines that producers and packagers use with these sleeves.

The company operates seven production facilities globally in Europe, South America and Asia Pacific. SIG has 5,200 employees, customers in more than 40 countries worldwide, and posted revenue of €1.68 billion in 2013.

''SIG's management team has successfully proven its ability to enter and expand in new markets, while maintaining its standard of excellence in existing markets,'' said Nigel Wright, a managing director in Onex' London office.''

''Our commitment to providing customers with a premier aseptic carton packaging system has made SIG a leader within our industry,'' said Rolf Stangl, CEO of SIG. ''We are excited about our next phase of growth in partnering with Onex.''

With offices in Toronto, New York and London, Onex has around $20 billion of assets under management and generates annual revenues of $22 billion.