Ardagh cans unit ‘turns corner' amid Coulson bid to keep control

Irish Times

24-04-2025

Ardagh Group said on Thursday that the outlook for its beverage cans unit is improving, as the group's main shareholder, Paul Coulson, vies to keep control of this part of his packaging empire even as he prepares to hand its troubled glass business over to creditors.
The group's 76 per cent-owned Ardagh Metal Packaging (AMP) unit reported its revenues grew by 11 per cent year-on-year in the first quarter to $1.27 billion (€1.12 billion), driven by a 6 per cent increase in sales volumes. Earnings also rose.
AMP chief executive Oliver Graham upgraded the subsidiary's sales and earnings guidance for the year, saying he now expects sales volumes to rise 3-4 per cent and earnings before interest, tax, depreciation and amortisation (Ebitda) to reach $695 million to $720 million, compared to $672 million for 2024.
It previously targeted shipment growth of 2-3 per cent and Ebitda in the range of $675 million to $695 million.
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Mr Graham said the drinks cans industry looks like it has 'turned a corner', helped by a rebound in activity across the energy drinks, sparking water and health and wellness categories.
He said that a sector slowdown last year suggests that there was 'a breather after big growth in previous years'.
Shares in AMP rallied as much as 26 per cent in early trading on Thursday on Wall Street.
However, Ardagh Group's legacy glass business saw its revenues drop 6.7 per cent to $961 million during the quarter as this arm of the group continued to struggle.
The trading update came as the Ardagh Group continues talks with bondholders on restructuring its estimated $12.5 billion debt mountain. The group's current proposal would see 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 business.
The plan also envisages Ardagh spinning its shares in AMP into a new company (NewCo). This would be 80 per cent owned by Mr Coulson and other existing shareholders – with the unsecured creditors receiving the remaining 20 per cent.
Two hedge funds moved in March, within days of the plan being outlined, to sue Ardagh Group and its controlling shareholder, Paul Coulson, alleging that a restructuring plan for the company's debt would amount to fraud, designed to 'siphon value away' from certain bondholders in favour of the businessman and other insiders.
The hedge funds, London-based Arini and Los Angeles-headquartered Canyon Partners, own more than 30 per cent of Ardagh's £400 million (€468 million) of unsecured bonds that are due to fall due in July 2027.
'The company strongly believes that the complaint is without merit and intends to vigorously defend against the proceedings,' Ardagh Group said in its first-quarter report on Thursday.
Mr Coulson controls Ardagh through an 18.8 per cent direct stake in its ultimate parent company and a 52.4 per cent interest in a vehicle called Yeoman Capital, which owns 33.9 per cent of the group. He effectively owns 36.6 per cent of the equity in a business that traces its roots to the Irish Glass Bottle Company, founded in Dublin in 1932.
Meanwhile, holders of some $1.8 billion of risky bonds issued by a holding company above the operating Ardagh Group are expected to lose almost all of what they are owed. These bonds were recently trading at about 5 per cent of their original value.
AMP and Ardagh Group executives signalled on Thursday that they expected neither arm of the business to be materially directly affected by tariffs – even as it remains unclear how they would affect consumer demand.