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Trivium Packaging Explores Potential Sale Amid Financing Discussions

Private credit funds may finance up to $2.5 billion for Trivium Packaging's potential sale, valuing the company over $3.5 billion.

By Max Weldon

4/3, 13:58 EDT
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Key Takeaway

  • Private credit funds are discussing financing up to $2.5 billion for the potential sale of Trivium Packaging, valued over $3.5 billion.
  • Trivium, with EBITDA just under $500 million and annual revenue around $3.3 billion, is exploring sale options amid Ardagh's debt management strategy.
  • The auction could attract private equity and industry peers due to Trivium's significant metal packaging market presence.

Exploring Sale Options

Private credit funds are reportedly in discussions to arrange up to $2.5 billion in financing to support the potential sale of Trivium Packaging, a US-based packaging firm. This development comes as Trivium’s shareholders, Ardagh Group SA and Ontario Teachers’ Pension Plan Board (OTPP), consider selling the company. The financing package being considered would include tranches in both US dollars and euros. However, sources familiar with the matter have indicated that the sale process is ongoing and its completion remains uncertain. Trivium, which was established in 2019 through the merger of Ardagh’s food and specialty packaging business with OTPP-backed Exal Corp., operates in the metal packaging sector serving various industries such as food, beauty, and home care.

Financial Background and Stakeholder Moves

Trivium Packaging is under the spotlight as its owners explore a sale that could potentially value the company at over $3.5 billion. This exploration of sale options is not the first for Trivium’s owners, who previously considered a deal in 2021 but ultimately did not proceed. Trivium boasts earnings before interest, taxes, depreciation, and amortization (EBITDA) of just under $500 million, with annual revenue around $3.3 billion as per the company’s website. The potential sale is part of Ardagh’s broader strategy to manage its debt, which stands at approximately €10 billion ($10.8 billion). Ardagh has engaged Houlihan Lokey Inc. and Kirkland & Ellis LLP as advisers amidst its debt management efforts, with its creditors also organizing into groups.

Market Interest and Potential Outcomes

The potential auction of Trivium is expected to draw attention from both private equity firms and industry peers, given the company’s significant presence in the metal packaging market. The interest in Trivium reflects the strategic value of its operations across various sectors, including food, beauty, and home care. Despite the ongoing deliberations and the absence of a definitive decision to sell, the exploration of a sale underscores the dynamic nature of the packaging industry and the strategic considerations of Trivium’s shareholders.