NEW YORK (TheStreet) -- Shares of Owens-Illinois (OI) were gaining 9.7% to $26.10 on heavy trading volume Wednesday after the beer and wine bottle maker announced it will acquired Mexican glass container manufacturer Vitro for $2.15 billion in cash.
Vitro is the largest supplier of glass containers in Mexico, and will give Owens-Illinois a competitive position "in the attractive and growing glass segment of the packaging market in Mexico," according to the company. The acquisition includes all of Vitro's five plants in Mexico and one in Bolivia.
Owens-Illinois expects Vitro to generate about $945 million annually following the acquisition.
The acquisition is expected to close within the next 12 months.
About 2.5 million shares of Owens-Illinois were traded by 10:22 a.m. Wednesday, above the company's average trading volume of about 1.7 million shares a day.
TheStreet Ratings team rates OWENS-ILLINOIS INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate OWENS-ILLINOIS INC (OI) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strongest point has been its expanding profit margins. At the same time, however, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows: