Glassmaker Ardagh believes it has the "inside track" in its efforts to gain control of the Canadian glassmaker Consumers International, which was put into the equivalent of examinership last week.
Ardagh is likely to be in competition with the US glassmaker Owens Illinois and two financial buyers for Consumers International or its individual assets, if the examinership fails to produce a rescue package.
Ardagh and its 20 per cent shareholder Yeoman International already have $32.6 million (€38 million) worth of Consumers' senior secured bonds and will buy a further $53.9 million worth of the bonds subject to approval at an extraordinary general meeting in two weeks time. This will give Ardagh and Yeoman almost 51 per cent of the bonds and put the Irish group in a pivotal position to determine Consumers' future.
At Ardagh's annual general meeting yesterday, chairman Mr Paul Coulson - who is also chairman of Yeoman - said the aim was to acquire Consumers on reasonable terms, probably through a debt/equity swap.
"We have started due diligence," he said. "Buying the bonds puts us on the inside track and we will have voting powers on any restructuring."
He said that if Ardagh/Yeoman are unsuccessful in a bid for Consumers, they should still get a good return on the Consumers bonds, which are secured on the group's assets. He rejected suggestions that the investment in the bonds was risky. "This has been very carefully assessed," he added.
Consumers International is the only glassmaker in Canada with 85 per cent of the market. It also has a 20 per cent share of the US glass market, which is dominated by Owens Illinois with 45 per cent and French group Saint Gobain with 35 per cent.
Mr Coulson said he believed American US customers such as Anheuser Busch are unlikely to favour a bid by Owens Illinois. "They would not like to see a duopoly," he said.
