Nampak acquires beverage can operation in Nigeria
Nampak has announced that it is to acquire Alucan Packaging, a beverage can manufacturer based in Nigeria.
Nampak has also been granted an option to acquire a leading rigid plastics company in Nigeria. The total investment is $301m ($186m), which will be funded through available cash resources and existing debt facilities.
The Alucan factory is equipped with a brand new, state-of-the-art aluminium beverage can line capable of producing up to one billion cans per annum. It has also been designed and constructed to accommodate a second line once demand exceeds the current capacity. The business is situated in the Agbara industrial area, which is an ideal location close to Lagos and to major beverage producing customers. It also has a reliable source of gas which will be used for heating and power generation.
Nampak’s CEO, Andrew Marshall says, “This acquisition will significantly increase Nampak’s presence in Nigeria, which is Africa’s second largest economy; and where we already manufacture food and general cans in our factory in Lagos and cigarette cartons, food cartons and labels at our factory in Ibadan, 120 kilometres north of Lagos.”
Beverage can manufacturing is one of Nampak’s core businesses, with factories in South Africa and Angola. With a population of over 150 million, Nigeria has experienced good growth in demand for beverage cans, and this is expected to continue. Plastic packaging is also a core business, with factories throughout the African continent and the United Kingdom.
Marshall continues, “This acquisition, and the potential to acquire the plastics company, will further contribute to our stated growth strategy in the rest of Africa where we currently operate in 12 countries, generating R2.5bn (£1.53bn) in annual revenue and almost 30% of our trading profit.”
The transaction is subject to the fulfilment of certain conditions, including South African Reserve Bank approval.