Equity Investments-K

12 Months Ended

Dec. 31, 2015

4. Equity Investments

At December 31, 2015 the Company’s ownership percentage in affiliates include:


	O-I Ownership
Affiliates	Percentage		Business Type
BJC O-I Glass Pte. Ltd.	50	%	Glass container manufacturer
CO Vidrieria SARL ("COV")	50	%	Glass container manufacturer
Rocky Mountain Bottle Company	50	%	Glass container manufacturer
Tata Chemical (Soda Ash) Partners	25	%	Soda ash supplier
Vetrerie Meridionali SpA ("VeMe")	50	%	Glass container manufacturer
Vetri Speciali SpA	50	%	Specialty glass manufacturer

In 2014, the Company entered into the COV joint venture with Constellation Brands, Inc. to operate a glass container plant in Nava, Mexico.

In 2013, changes were made to the VeMe joint venture agreement that resulted in the Company relinquishing control of the joint venture and, therefore, deconsolidating the entity. No gain or loss was recognized related to the deconsolidation as the fair value of the entity was equal to the carrying amount of the entity’s assets and liabilities. The fair value, which the Company classified as Level 3 in the fair value hierarchy, was computed using a discounted cash flow analysis based on projected future cash flows of the joint venture.

Summarized information pertaining to the Company’s equity associates follows:


	2015		2014		2013
Equity in earnings:
Non-U.S.	$	23	$	23	$	27
U.S.		37		41		40
Total	$	60	$	64	$	67
Dividends received	$	53	$	54	$	67

Summarized combined financial information for equity associates is as follows (unaudited):


	2015		2014
At end of year:
Current assets	$	430	$	479
Non-current assets		959		718
Total assets		1,389		1,197
Current liabilities		203		217
Other liabilities and deferred items		211		191
Total liabilities and deferred items		414		408
Net assets	$	975	$	789


For the year:	2015		2014		2013
Net sales	$	719	$	752	$	699
Gross profit	$	193	$	198	$	185
Net earnings	$	139	$	150	$	149

Based on an evaluation of each of the Company’s equity investments for the three years ending December 31, 2015, no investments exceeded the significant subsidiary thresholds per Rule 3-09 of Regulation S-X. As such, separate financial statements for the Company’s equity investments are not required to be filed.

The Company made purchases of approximately $161 million and $188 million from equity affiliates in 2015 and 2014, respectively, and owed approximately $66 million and $79 million to equity affiliates as of December 31, 2015 and 2014, respectively.

There is a difference of approximately $18 million as of December 31, 2015, between the amount at which certain investments are carried and the amount of underlying equity in net assets. The portion of the difference related to inventory or amortizable assets is amortized as a reduction of the equity earnings. The remaining difference is considered goodwill.