Sometimes only hours separate a mooted deal from a done deal. After leading UK packaging producer Rexam (London; www.rexam.com) on Friday denied that a takeover of the Owens-Illinois (O-I, Perrysburg, Ohio / USA; www.o-i.com) plastic packaging division was imminent, the two companies announced on Monday that a "definitive agreement" had been reached – see Plasteurope.com Web of 11.06.2007.

The business will change hands for a cash consideration of around USD 1.8 bn, to be paid at the closing of the transaction targeted for Q3 2007. Rexam plans to pay for the purchase through an issue of new shares worth almost 10% of its existing share capital, a subordinated bond issue and the expected GBP 449m (nearly EUR 662m) proceeds from the sale of its glass business, announced in March 2007. Due to tax benefits to be amortised over 15 years, the actual purchase price is put at around USD 1.6 bn. For 2006, O-I Plastics, which employs 2,800 people at 19 sites worldwide, reported sales of USD 760m and underlying profit of USD 114m.

In 2006, Rexam's plastic packaging business represented 20% of group turnover of GBP 3.7 bn and 14% of operating profit from continuing operations. With the takeover, the UK group said it will have "leading positions" in rigid plastic healthcare packaging and closure systems. The acquisition "gives us meaningful scale in plastics," said CEO Leslie Van de Walle. Rexam already is regarded as market leader in (metal) beverage cans. On completion of the purchase, plastic packaging is expected to account for about a third of its overall business and generate synergies of USD 40m annually by 2010.