Coulson nears $300m deal to walk away from debt-laden Ardagh
Paul Coulson
is nearing a deal to walk away from
Ardagh Group
, the packaging empire he built over the past 25 years, as debt restructuring talks with bondholders reach a pivotal point.
Mr Coulson is willing to accept $300 million (€255.6 million), which he would likely have to share with other shareholders in the Ardagh Group, to exit the business, according to sources.
This would see Mr Coulson cede control of the glass and metal containers giant, which has a total of about $12.5 billion of borrowings, and abandon previous notions of retaining control of its prized Ardagh Metal Packaging (AMP) arm.
A spokesman for Ardagh Group, whose customers range from Coca-Cola and Heineken to Nestlé, declined to comment. Bloomberg first reported that Mr Coulson is close to a compromise.
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The Dublin native controls the parent of the group – ARD Holdings – through a 18.8 per cent direct stake and 52.4 per cent interest in a vehicle that owns 33.9 per cent of ARD Holdings.
Ardagh Group has acknowledged for more than a year that it needs to reduce its unsustainable liabilities, after both its glass and beverage cans businesses had been hit since the Covid-19 pandemic by inflation, soaring interest rates, and soft consumer demand on both sides of the Atlantic.
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The heavily-indebted business proposed in March that a group of senior unsecured bondholders write off much of the $2.32 billion they are owed in exchange for taking full ownership of the glass containers part of the business.
Mr Coulson had planned at the time to give the unsecured creditors just 20 per cent of AMP, which has ring-fenced borrowings and has seen its earnings improve significantly in recent quarters even as the glass business remains under pressure.
That proposal failed to progress. Talks are now centred around Mr Coulson exiting entirely, albeit with a pay-off to avoid a likely protracted legal battle over AMP. The drinks unit is listed on the New York Stock Exchange, but remains 76 per cent owned by Ardagh Group.
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The market value of AMP has jumped by as much as 60 per cent so far this year to $2.86 billion, driven by a spike in April when its chief, Oliver Graham, signalled that the business had 'turned a corner', helped by a rebound in demand for energy drinks, sparkling water and health segments.
AMP reported on Thursday that its earnings before interest, tax, depreciation and amortisation (Ebitda) rose 18 per cent in the second quarter to $210 million.
The company upgraded its full-year earnings forecast for a second time and now sees Ebitda rising to $705 million-$725 million from $672 million for 2024. It had started out the year predicting that earnings would fall between $675 million and $695 million.
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Ardagh in talks to hand control of glass business to bondholders
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AMP's global beverage can shipments grew by 5 per cent in the quarter driven by growth of over 8 per cent in the Americas, driven by energy drinks, and expansion of 1 per cent in Europe.
'Our performance is also testament to the resilience of our business, despite macroeconomic uncertainties, with shipments growth reported across each of our markets,' said Mr Graham
. 'Global beverage can growth continues to benefit from innovation and share gains in our customers' packaging mix, and we still anticipate only a minimal impact to our business arising from tariff measures announced.'
Ardagh Group typically reports results on the same day as AMP. However, it has held off on publishing its figures amid the ongoing debt restructuring talks.
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