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Saturday 20 September 2014

Coulson to join billionaire club as €3bn Ardagh moves to float

Top executives at glass company own €750m stake

Published 20/01/2013 | 07:07

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Paul Coulson

LOW-PROFILE deal maker Paul "the Cooler" Coulson is poised to become the country's latest billionaire as his €3bnvalued glass and tin can maker Ardagh powers towards the stock market.

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Ardagh is understood to have told investors that it will seek an initial public offering in the US in the fourth quarter of this year — subject to healthy stock market conditions, according to market sources. Ardagh declined to comment.

Coulson owns a 36 per cent stake in the fast-growing industrial behemoth, which has mushroomed in size over the last year following a €2bn acquisition blitzkrieg.

Last week, Ardagh inked a €1.3bn deal to buy St Gobain's Veralia operations in North America. Six months ago, the firm paid €721m to take over rival packaging group Boxal Glass. Ardagh is now the second biggest glass packaging maker in the world — second only to Owens Illinois, according to CapitalStructure research.

The 60-year-old Shrewsbury Road financier — who has been a Fine Gael trustee — joins Denis O'Brien, Pearse Lyons, Hilary Weston and Dermot Desmond in the club of Irish-born billionaires. Coulson became chairman of Ardagh in 1998 when it was a small listed glass bottle maker. He took the company private in 2003, spinning out its property interests into a separate firm, South Wharf. Coulson then led the deal to sell the €412m Irish glass bottlers site to property speculators at the peak of the boom in 2006.

Ardagh unveiled the biggest junk bond deal seen on markets in two years as it sought to raise €1.1bn in dollar and euro notes to fund the deal. Strong investor demand saw an extra €115m raised on top of the initial offer, which was six times over subscribed. Citi Group and Freshfields Bruckhaus Deringer have been advising the company.

Two years ago, following the €1.7bn buyout of tin can maker Impress, Ardagh started the process of seeking a stock market listing in the US. However, in early 2011, these plans were derailed by stock market volatility.

Ardagh is thought to be worth €3bn, on top of its €4.7bn debt. The glass and tin can firm has debt of €3.54bn plus cash of over €350m. The company now has annual earnings approaching €900m, with its peers valued at around 8.5 times' earnings, according to market sources.

The latest acquisition, which will close in the coming months, means that Ardagh will have global sales of over €5.4bn. The Veralia deal will add around €1.2bn in annual sales and means that over 40 per cent of Ardagh's earnings will now come from the US. An Ardagh investor document obtained by the Sunday Independent shows that the company has increased its revenues 100-fold since 1999 and seven-fold since 2007.

Coulson is not the only one who will make a fortune from an IPO. Chief executive Niall Wall, who has driven the staggering growth programme, has a 9.52 per cent stake worth over €285m, with former chief executive Eddie Kilty's 3.45 per cent stake worth over €103m. Ardagh corporate development officer Brendan Dowling — a former Davy Stockbrokers economist — has a 2.97 per cent stake that is valued at up to €89m.

Director Houghton Fry, the former managing partner of law firm William Fry, has shares worth over €71m, with finance chief John Riordan owning a €28m stake. Some 13 per cent of Ardagh shares are held by private investors and institutions, many of whom have been shareholders for over a decade.

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