Ball announced this morning that it completed the sale of its aerospace business to BAE Systems for approximately $5.6 billion.
Ball will see approximately $4.5 billion of after-tax cash proceeds from the deal. About $2 billion each will go toward reducing debt leverage and stock buybacks, while the remainder will boost the company’s balance sheet and give it “greater financial flexibility.”
"Today marks a significant milestone in Ball's 144-year history. We extend our best wishes for continued success to our former colleagues and their new BAE Systems, Inc. teammates,” said Ball CEO Dan Fisher in a statement.
Ball first disclosed the deal with BAE Systems in August 2023, following June confirmation of market speculation that it was “considering options that could better position its aerospace business to provide value to shareholders and customers.” At the time, Fisher said the divestiture would allow Ball to increase its focus on “low-carbon, best-value aluminum packaging initiatives.” The deal had been projected to close in the first half of 2024.
Ball reported on Wednesday that the U.S. Department of Justice had ended its review of the deal, following other necessary regulatory approvals and clearances.
In 2023, the aerospace division accounted for $1.97 billion in sales, down slightly from $1.98 billion in 2022. “Backlog finished the year at $2.98 billion and contracts won, but not yet booked into backlog, finished the year at $5.9 billion,” Ball said in its recent earnings release. The business does work for the likes of NASA and the U.S. Space Force.
Ball reported overall net sales of $14.03 billion for 2023. During a recent earnings call, Fisher said that “significant opportunity lies ahead to offset the financial impact of the projected aerospace sale” by “leveraging our well-capitalized plant assets to grow the use of innovative, sustainable aluminum packaging across channels, categories and venues.”
