Visy is reportedly squaring off against two private equity firms in the battle for Owens-Illinois (OI)’s Australian and New Zealand assets, as the bidding enters its final round.

The packaging giant, owned by Australia’s richest person Anthony Pratt, is up against Sydney-based firm Pacific Equity Partners and international private equity firm Blackstone in the $1bn Goldman Sachs-run auction of OI’s local glass business, according to the Australian Financial Review.

Visy sees “strong strategic merit” in the OI acquisition given potential synergies with its own small glass business, says AFR, and is taking its own counsel on the proposal.

PKN spoke to analyst Paul Allen of Margin Partners who says the major challenge for all bidders right now is validating just how much contracted demand OI Glass has.

"Analysts are scurrying around respective glass categories and customers trying to determine the truth behind OI’s demand, customer tenure and quality claims. No one wants to pay a premium for a glass factory that isn’t 95% sold out!"

Major local food and beverage clients of OI Glass ANZ are watching carefully and keeping their buying powder dry, Allen says.

"There appears to be plenty of value in this forthcoming sale process for many stakeholders," he says.

Binding offers for the third and final stage of the OI auction are due by 19 February. Pacific Equity Partners last year raised $2.5bn for acquisitions. 

Food & Drink Business

Murray River Organics has partnered with Coles to enter the $1 billion breakfast cereal category, with the consumer brand launch of a new range of organic mueslis in 800 stores nationwide. It is expected to raise $5 to $6 million in revenue per annum.

The May/June issue of Food & Drink Business is out. It features our annual classified industry directory, a bumper 14-page processing & packaging tech update and loads of features on what's happening in the sector.

B2B beverages marketplace Kaddy has raised $3.5 million in funding, with the new funds aimed at helping the start-up enhance its platform capabilities, grow the team and expand interstate.