(MENAFN - AFP) French materials giant Saint-Gobain said Thursday it had accepted a 1.7 billion (1.3 billion euros) offer from glass packaging group Ardagh for its North American bottle and jar unit Verallia NA.
"After having consulted its Works Council and having collected its favourable opinion, Compagnie de Saint-Gobain accepted the purchase offer of Ardagh on Verallia North America for an enterprise value of 1,694 million," it said in a statement.
It said the price was 6.5 times the company's VNA 2012 EBITDA operating profit.
The deal, subject to approval of US anti-trust authorities, will enable Saint-Gobain to reduce debt and expand Ardagh's operations further.
Ardagh chairman Paul Coulson, credited with driving a decade of ambitious growth, said in a statement on Monday that buying VNA "would be another important milestone in the evolution of Ardagh as it would add scale, diversity and value to our global packaging operations."
Ardagh, which has developed from the Irish Glass Bottle Company founded in Dublin in 1932 but is now based in Luxembourg, is already a big international player in the packaging sector. It operates in 26 countries and employs 22,000 people.
Last year Verallia NA, based in the US state of Indiana, generated sales of about 1.61 billion and an operating profit of 171 million.
Verallia says it is the second-biggest maker of glass bottles and jars in the United States where it has 13 industrial sites which employ slightly more than 4,400 people.
Saint-Gobain said earlier that the money raised by the sale would be used mainly to strengthen the group's balance sheet. The company would continue with its targeted policy of buying small and medium-sized businesses.