Ball Corp’s Boring Billions

Ball Corporation didn’t invent the aluminum can, but it mastered the business of making them. At the start of the 2010s, beverage packaging was a commoditized, cyclical industry defined by razor‑thin margins and intense price competition. Investors largely ignored Ball, a 140‑year‑old company largely known for jars and cans, until its leadership quietly consolidated the market and went from just another vendor to the supplier. 

Ball’s beverage packaging EMEA segment notes that the aluminum beverage container market in the countries where it operates is roughly 93 billion cans a year. Ball is the largest producer in the region, supplying about 39% of shipments, giving it near-unrivaled bargaining power with suppliers and customers, explaining why the company can earn mid‑teens margins in a business many assume is a commodity.

Here’s what you’ll learn: 

Here’s the problem with making aluminum cans, they’re all basically the same. Coca-Cola could switch can suppliers tomorrow, and consumers wouldn't notice. Prices moved up and down with aluminum costs. Historically, this is an industry where there’s no loyalty, little switching costs, and virtually nothing to stop customers from walking away. The entire industry has survived on paper-thin profits and constant price wars.

Ball Corp’s leadership saw one way out of this cycle: get massive. If you're big enough, you stop being just another supplier. You become someone aluminum producers have to negotiate with, a player who can lock in long-term deals. Someone who runs so many plants that closing a few bad ones barely matters. The supplier that customers can't easily replace.

But to get that big, and command that type of power, required a gamble that would either transform Ball or bury them in debt.

Ball's escape plan had two parts that, to most, would never seem connected.

In 2016, they made their move, acquiring Rexam, Europe’s biggest beverage can manufacturer. Overnight, they became a heavyweight, to the point where regulators forced them to sell off some facilities to competitors, but they were already a heavyweight. pumping out about 100 billion cans a year. The plan was simple: cut $300 million in costs within three years. Nearly half would come from firing redundant executives and closing duplicate offices. Another third from buying materials in bulk and negotiating harder. The rest from smarter shipping and optimizing logistics. Then they'd close expensive plants, standardize how everything worked, and start passing costs to customers instead of eating them.

The Aerospace Hedge

Ball entered aerospace decades prior, having been building spacecrafts since 1956. What started as a partnership with University of Colorado physicists grew into a premier aerospace contractor, producing nearly $2B in revenues by 2023 from building satellites, instruments, and defense tech. This business did something that the beverage business couldn't: deliver predictable, high-margin revenue. NASA contracts lasted years, work with the DoD came with built in escalations. By the end of 2023, the Ball Aerospace division had $2.98 Billion in backlog, plus another $5.9 Billion in contracts that hadn't been formally booked yet, many of which were cost-plus agreements where the government guaranteed margins.

These weren’t just any projects, the division supplied critical instruments for NASA’s most ambitious missions. Ball built all 18 beryllium mirror segments for the James Webb Space Telescope, working as the main subcontractor to Northrop Grumman. The lightweight mirrors essentially allow astronomers to see back in time and detect faint infrared light from the early universe. They also developed TEMPO, an air quality instrument that sits in geostationary orbit scanning North America every hour, tracking ozone, nitrogen dioxide, sulfur dioxide, and formaldehyde. Its real-time data will help scientists and public health officials trace pollution sources and movement. 

When sales dropped during recessions, aerospace contracts kept cash flowing. When aerospace programs got delayed (as they often do), packaging threw off steady cash.

By 2023, scale had delivered everything Ball wanted. They controlled 38% of Europe's 90 billion-can market and 47% of South America's 41 billion cans. With only a handful of real competitors left, Ball could focus on higher-margin specialty cans instead of commodity products. The numbers proved it as North American operating profit grew 11% even as revenue fell by the same amount. That’s the type of luxury having pricing control gives you. With the aerospace division also thriving, leadership knew it was time to strike. In August 2023 they Ball sold the entire division to BAE Systems for $5.6B, at roughly 20x EBITDA. They immediately put the cash to work, paying down debt, share buybacks and strengthening the balance sheet. These moves returned nearly $2B to shareholders in 2024 alone.

Most CEOs would have held on, but the logic behind the sale was sound. Aerospace required constant R&D and had started competing for talent with companies like SpaceX and Lockheed. By now, packaging was a cash machine, dominating three continents, and didn’t need aerospace’s stability anymore. With aerospace gone, they refocused bets on the core packaging business. Today, they’re a pure play packaging giant that you’ve probably never heard of.

Here are the takeaways you can apply…

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39% – Ball’s share of a 93 billion‑can EMEA market; its 19 plants shipped 36 billion cans in 2024.

47% – Ball’s estimated share of South America’s 43 billion‑can market.

$4.5B – How much Ball made post-tax after selling their aerospace division to BAE Systems.

$1.96B – How much Ball Corp returned to shareholders in 2024.

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