PARIS -- Glass packaging leader Ardagh Group said on Monday that it had offered to buy North American glass packaging interests from French materials giant Compagnie de Saint-Gobain (IW 1000/79) for about $1.7 billion to climb into a new league in the global packaging business and raise its product range.

The deal will enable Saint-Gobain to reduce debt.

Ardagh Chairman Paul Coulson, credited with a driving a decade of ambitious growth, said in a statement that buying Verallia North America, which is based in Indiana, "would be another important milestone in the evolution of Ardagh as it would add scale, diversity and value to our global packaging operations."

Ardagh, developed from the Irish Glass Bottle Co. founded in Dublin in 1932 but now based in Luxembourg, is already a big international player in the packaging sector. It operates in 26 countries and employs 22,000 people.

The company said it had made "a binding and irrevocable offer and entered into exclusive negotiations" with Saint-Gobain for its Verallia North America (VNA) unit, with an offer of about $1.7 billion."

Eye on Wine Sector

Group CEO Niall Wall added that acquiring VNA "would allow us to expand our glass operations into the very important wine sector in the U.S. for the first time."

Last year the North American activities of Verallia generated sales of about $1.61 billion and an operating profit of $171 million.