In an effort to expand its business footprint across Africa and solidify its presence in one of Africa’s burgeoning countries, Nampak, a South African packaging company said it has entered into an agreement to acquire Nigerian beverage can manufacturer, Alucan Packaging Limited and has also been granted an option to acquire a leading rigid plastics company in the country for a total investment of $301 million.

Nampak said the deal will be funded with a mix of cash resources and existing debt facilities.

Beverage can manufacturing is one of Nampak’s core businesses with factories in South Africa and Angola. The company expects this acquisition to significantly increase its presence in Nigeria, which is Africa’s second largest economy and where it already manufacturing facilities in Lagos and Ibadan

With the deal, Nampak will gain a brand new, state-of-the-art aluminum beverage can line factory that’s capable of producing up to one billion cans per annum and has also been designed and constructed to accommodate a second line once demand exceeds the current capacity.

Nigeria, with a population of over 150 million people, has experienced good growth in demand for beverage cans and this is expected to continue. Plastic packaging is also a core business with factories throughout the African continent.

Headquartered in Lagos, the Alucan factory is situated in the industrial area of the city that’s ideally close to major road outlets and beverage manufacturers as well as having a reliable source of gas for heating and power generation.

“This acquisition and the potential to acquire the plastics company will further contribute to our stated growth strategy in the rest of Africa where we currently operate in 12 countries generating R2.5 billion in annual revenue and almost 30% of our trading profit,” said Andrew Marshall, Nampak’s chief executive officer.