The world’s largest supplier of drinks cans, Ball Corporation, has announced its intention to buy UK-based rival Rexam in a £4.3 billion deal.
The US-based manufacturer had global sales of $8.6 billion in 2014, while Rexam, the biggest can maker in Europe and number two in the US, had sales of £3.9 billion in 2013.
Ball said the takeover would create a company with revenues of around $15 billion (£9.6 billion) and a “global leader in metal beverage packaging that will be better positioned to serve its combined customer base through shared best practices, supply chain efficiency, manufacturing excellence and increased product innovation”.
The firm said the deal would produce annual cost synergies of around $300 million (£195 million) after three years.
Under the terms of the deal, which is subject to competition authority clearances and a shareholder vote, Rexam shareholders will be offered a combination of cash and Ball shares.
Rexam chairman Stuart Chambers said: “In recent years Rexam’s management team has led to a transformation of the group, returning approximately £1.5 billion of cash to shareholders since 2010 and creating a focused beverage can maker with a promising future. Notwithstanding that, the Rexam board believes the proposed combination with Ball will bring an enhanced ability to serve the demands of our increasingly global customers and represents a compelling opportunity for our shareholders.”
John Hayes, president and CEO of Ball, said: “The combination of Ball and Rexam creates a global metal beverage packaging supplier capable of leveraging its geographic presence, innovative products and talented employees to better serve customers of all sizes in all regions across the globe.”