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Ball Corp. to purchase part of Continental Can.

Ball Corp. to purchase part of Continental Can

In an effort to make its business dealings more international, Ball Corp. last week announced a definitive agreement to purchase the European operations of Continental Can Co. for $1.03 billion.

Under the agreement, Continental Can's parent company, Peter Kiewit Sons' Inc. will receive $625 million in cash, and an additional $400 million in common and preferred stock.

According to a statement from Ball Corp., the European "beverage can market is positioned for significant growth" due to the forecast reduction of European national trade barriers and the emergence of the Eastern European market.

Last year, Ball reported a net income of $35.8 million, however; analysts expect the company to post stronger earnings in 1990.

In addition to the cash being offered for Continental Can Europe, Ball plans to issue $200 million of common stock, $129 million of voting convertible exchangeable preferred, and $71 million of a non-voting form of preferred stock.

According to Ball's chairman and chief executive officer Richard Ringoen, the container company chose to finance with a "significant amount of equity so that we wouldn't be financially constrained from pursuing the growth prospects of the business, which appear to be excellent."

The proposed sale is still subject to approval by Ball shareholders, as well as clearance by regulators.

Last year, Continental Can Europe had sales of $1.47 billion, although total earnings were not released for that period. The company manufactures metal containers for food, beverages and as well as other general containers.

Kiewit acquired the then Continental Group Inc. in 1984 for $2.9 billion, and then proceeded to sell off a number of non-container operations to help relieve some of its debt from the sale.
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Title Annotation:European operations
Publication:Modern Brewery Age
Date:Aug 6, 1990
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