EXHIBIT 99.1
Greif Bros. Corporation News Release
425 Winter Road
Delaware, Ohio 43015
Greif Bros. Corporation Announces Completion
of Van Leer Industrial Acquisition
Greif Closes Purchase of Van Leer Industrial for $555 Million
Acquisition Makes Greif the Global Leader in
Industrial Packaging Products and Shipping Solutions
DELAWARE, OH (March 2, 2001) - Greif Bros. Corporation (NASDAQ:
GBCOA/GBCOB) today announced completion of its purchase of the
Van Leer Industrial packaging division from Huhtamaki Van Leer
Oyj of Espoo, Finland (HEX: HVL1V) for $555 million, which
includes the assumption of debt and other obligations. Greif and
Huhtamaki announced the signing of a definitive purchase
agreement for Van Leer Industrial on October 30, 2000 and an
amendment on January 26, 2001.
With the purchase of Van Leer Industrial, Greif nearly doubles
its revenue base and becomes the global leader in the industrial
packaging products business, with approximately 200 locations,
11,000 employees and 19,000 customers in more than 40 countries.
"Combining Greif and Van Leer Industrial creates a stronger
company focused on providing a wide range of packaging solutions
for global as well as regional customers," said Michael J.
Gasser, Greif chairman and chief executive officer. "Our first
priority continues to be the acceleration of our historical
growth rates by taking advantage of favorable opportunities in
international markets."
Greif's Expanded Industrial Shipping Containers Business
Before the acquisition, Greif was the leading supplier of
industrial shipping containers in North America. The Van Leer
Industrial acquisition expands Greif's markets to Europe,
Africa, Asia, Australia and Latin America. Greif anticipates
that approximately 80% of net sales for the combined Company
will be from North America and Europe and 20% from the remaining
regions.
The product line for Greif's Industrial Shipping Containers
business segment includes steel drums, fibre drums, plastic
drums, intermediate bulk containers, plastic bottles, steel
pails and drum closure systems. In addition, the Company
provides various packaging-related services.
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Greif also has two other lines of business in the United States
market: Containerboard & Corrugated Products and Timber. For the
year ended October 31, 2000, Greif reported net sales of $929.9
million, which included $476.3 million for the Company's
Industrial Shipping Containers segment, $408.9 million for the
Containerboard & Corrugated Products segment and $44.7 million
for the Timber segment.
"The Greif-Van Leer Industrial combination is a revolutionary
step in a mature, consolidating industry and is an important
part of our plan for creating additional value and opportunities
for our customers, shareholders and employees," Mr. Gasser said.
"While there will be cost savings resulting from the integration
process, the Van Leer Industrial acquisition reflects Greif's
customer-driven growth strategy."
This growth strategy is based on:
* The broadest product and service offering in the industrial
packaging products industry
* Increased ability to respond to global packaging needs of
multinational customers
* Global market and leadership position for industrial
packaging
* Balanced, globally diversified revenue mix
* Meaningful synergies through improved operating efficiencies,
purchasing economies and cross-selling opportunities
* Leveraging a global infrastructure to provide more products
to more customers
As previously reported, the Company expects the Van Leer
Industrial acquisition to be accretive to earnings per share
within one year from closing.
Experienced Worldwide Packaging Leadership
William B. Sparks, Jr., Greif's president and chief operating
officer, will continue to lead the Company's Industrial Shipping
Containers business. In addition, Francisco de Miguel, president
of Van Leer Industrial and a 33-year employee, will be
responsible for overall management of the industrial packaging
business in Europe, Asia, Australia and Africa, as well as the
drum closures business.
"We are extremely pleased that Francisco de Miguel, along with a
large majority of Van Leer Industrial executives, will remain
with the international operations and actively participate in
the management of the Company to ensure continued quality
service to our customers," Mr. Gasser stated. "With these
experienced individuals along with the solid Greif management
team, we are confident in a smooth transition and positive
future."
The Industrial Shipping Containers business will operate in
seven geographic regions within the Company's global markets.
Van Leer Industrial managers have been appointed to manage six
regions, and a Greif manager will direct the North America
region. Tri-Surer, the Company's drum closure systems business,
will operate as a separate unit within the Industrial Shipping
Containers business.
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Mr. Gasser said that integration teams were formed earlier this
year and are working in all key locations to implement best
practices, identify new marketing opportunities and explore
manufacturing and purchasing efficiencies.
Financing
As previously reported, the Company is financing the acquisition
through $900 million of Senior Secured Credit Facilities
arranged by Merrill Lynch & Co., Inc. with a syndicate of
lenders. Proceeds will be used to complete the acquisition of
Van Leer Industrial and to refinance the Company's existing
debt, and the remaining amounts will be available for working
capital and general corporate purposes.
Standard & Poor's and Moody's Investors Service have assigned
"BB" and "Ba3" ratings, respectively, to the Company's new $900
million credit facilities. Both rating agencies stated positive
outlooks. The credit facilities consist of two term loans, a
$350 million five-year term loan A and a $400 million seven-year
term loan B, as well as a $150 million multi-currency revolving
credit facility.
Financial Overview
The Company will complete pro forma financial statements in
accordance with accounting principles generally accepted in the
United States and will file them with the U.S. Securities and
Exchange Commission within 75 days after closing. The excess
amount of the purchase price over net asset value, prior to
purchase accounting and post-closing adjustments and translation
to accounting principles generally accepted in the United
States, is expected to be approximately $80 million. The
following financial information is for reference only, and
addition of the stated amounts is not indicative of the pro
forma results of the combined Company.
Historical Income Statement Information
Greif Bros. Corporation Van Leer Industrial(a)
(US $ Million) (US$ Million) (b)
For the Year Ended October 31, 2000 December 31, 2000
Net sales 929.9 951.0
EBIT before special charges 112.3 41.9 (c)
EBITDA before special charges 157.5 78.7 (c)
<FN>
(a) Unaudited and before synergies
(b) Based on convenience translation, numbers converted from
Euro currency as of 12/31/00 at .925 to the US dollar.
(c) Excludes special charges or non-recurring expenses of
approximately US $9 million.
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About Greif Bros. Corporation
Greif, which is headquartered in Delaware, Ohio, has been a
packaging company since its inception in 1877. The Company
provides a broad variety of industrial shipping containers
(which include fibre drums, plastic drums, steel drums,
intermediate bulk containers, steel pails, drum closures and
plastic water bottles) and containerboard and corrugated
products (which include semichemical and recycled medium,
recycled linerboard, corrugated boxes, corrugated honeycomb
products and multiwall packaging) as well as manages timber
properties. Greif has approximately 11,000 employees in more
than 40 countries. Additional information is on the company's
web site at www.greif.com.
Some of the information in this press release contains "forward-
looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. The words "believe," "expect,"
"anticipate," "project," and similar expressions, among others,
identify forward-looking statements. Forward-looking statements
speak only as of the date the statement was made. Such forward-
looking statements are subject to certain risks and
uncertainties that could cause the Company's actual results to
differ materially from those projected, including the statements
that the combination of Greif and Van Leer Industrial creates a
stronger company focused on providing a wide range of packaging
solutions for global as well as regional customers, and the
Company's first priority continues to be the acceleration of its
historical growth rates by taking advantage of the favorable
opportunities in international markets (paragraph three), the
Greif-Van Leer Industrial combination is a revolutionary step in
a mature, consolidating industry and is an important part of the
Company's plan for creating additional value and opportunities
for its customers, shareholders and employees (paragraph seven),
there will be cost savings resulting from the integration
process (paragraph seven), the Company expects the Van Leer
Industrial acquisition to be accretive to earnings per share
within one year from closing (paragraph nine), the following
financial information is for reference purposes only and the
addition of the results of both companies is not indicative of
the pro forma results of the combined company (paragraph
sixteen). Risks and uncertainties that might cause a difference
include, but are not limited to, changes in general business and
economic conditions and litigation or claims against the
Company. These and other risks and uncertainties that could
materially affect the financial results of the Company are
further discussed in the Company's Annual Report on Form 10-K
for the year ended October 31, 2000. All forward-looking
statements made in this announcement are based on information
presently available to the management of the Company. The
Company assumes no obligation to update any forward-looking
statement.
For Additional Information:
Media Inquiries:
Krista Heins
Director, Communications
Greif Bros. Corporation
740-549-6074
klheins@greif.com
Anita Bose
Robinson Lerer & Montgomery
212-484-7699
abose@rlmnet.com
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Shareholder/Analyst/Investor Inquiries:
Robert Lentz
Robert A. Lentz and Associates
614-876-2000
rlentz@investquest.com
Anita Bose
Robinson Lerer & Montgomery
212-484-7699
abose@rlmnet.com