Amcor, I told U so

a few days ago AMC was in bluechips to watch, today we have an announcement, hehe. this part of the process doesn't always work though b/c sometimes its distribution or artificial support, rather than organic, nevertheless, the words speak ....

Amcor buys Schmalbach-Lubeca PET assets for $2.9bn
09:40, Wednesday, 8 May 2002

Sydney - Wednesday - May 8: (RWE) - Amcor Ltd has entered an
agreement to buy the PET container and closure assets of German-based
Schmalbach-Lubeca for $2.875 billion.
The price represents a trailing EBITDA multiple of 6.7 times
earnings to March 31.
Schmalback is the world's largest manufacturer of PET
containers.
Amcor said the combined group would be well positioned to target
the higher value-add and faster growing segment of custom bottles, where
bottles are designed for specific applications such as filling
temperatures of up to 95 degrees celsius or multilayer wall
construction.
The combined Schmalbach PET and closures business had calendar
2001 sales revenue of $3.3 billion.
Amcor managing director Mr Russell Jones said: "Amcor is
purchasing an extremely well managed business with an excellent track
record of growth.
"The plants are well capitalised with modern equipment and
efficient manufacturing processes.
"In combining the two businesses, Amcor has created the leader
in PET containers.
"It will be able to enhance product innovation, purchasing and
customer relationships across a global operation," Mr Jones said.
He said the company was targeting synergies from the acquisition
of about $75 million a year by year three, with $20 million achieved in
year one.
"These benefits will be realised through improved efficiencies
via plant rationalisation and product optimisation, as well as
purchasing benefits and overhead reductions."
The acquisition is expected to be earnings per share positive by
year one.
Amcor said it remained confident its target growth of 10 per
cent for net profit for the full year would be achieved, and expects the
October dividend to be 14c.
The acquisition will be funded through a combination of new
equity, debt, and the sale of Amcor's 45 per cent interest in
Kimberly-Clark Australia.
Shares in Amcor last traded at $7.68 and has been placed in a
trading halt.