Packaging firm Silgan and American Industrial to buy Trivium Packaging in $3.4 billion deal

Oct 19 (Reuters) - US consumer goods packaging maker Silgan Holdings and private equity firm American Industrial Partners will acquire Trivium Packaging in a deal that would value the European firm at $3.4 billion, including debt, the companies said on Monday.

Higher raw material costs due to growing inflation and geopolitical tensions have been squeezing margins for packaging makers.

Trivium makes recyclable packaging material and is currently owned by Ontario Teachers' Pension Plan and Ardagh Group SA.

Shares of Silgan were up 1% in premarket trading.

The transaction will combine Silgan's metal packaging business with Trivium, creating a global metal packaging business valued at $7.3 billion, according to Silgan.

American Industrial Partners would invest about $1 billion in Silgan's purchase of Trivium, and would own about 40% of the combined company. 

Silgan said its partnership with American Industrial Partners for its combined metal packaging business will generate about $2.3 billion in cash proceeds for the company, while allowing it to retain a 60% stake in the venture.

The company, which also reaffirmed its full-year adjusted net income per share forecasts, said the deal is expected to close mid-2027.

(Reporting by Shania S Thomas in Bengaluru; Editing by Leroy Leo)