5th Feb 2015 13:28
LONDON (Alliance News) - Shares in Rexam PLC surged higher on Thursday after the company confirmed it has received a GBP4.3 billion takeover approach from US rival Ball Corp and said the two are now in talks.
In a statement, the British drinks can maker said Ball's proposal values Rexam at 610 pence a share, well above its current share price, and is based on a consideration of about two-thirds cash and one third new Ball shares.
"Discussions on other matters are continuing and there can be no certainty any formal offer will be forthcoming, or as to the terms of any offer," the company said in a statement.
Ball now has to make a firm offer by 1700 GMT on March 5 under UK takeover rules or walk away for at least six months.
Later on Thursday, Ball Corp also confirmed the two companies are in talks on a deal, which it said would involve an acquisition of Rexam with a combination cash and equity. It said a further announcement will be made "when appropriate".
Rexam shares were up 22% to 548.00 pence early afternoon on Thursday, comfortably the best performer in the FTSE 250.
Rexam is one of the world's largest manufacturers of drinks cans, and it counts brewers AB InBev SA, Carlsberg A/S and Heineken NV, and soft drinks makers The Coca-Cola Co, PepsiCo Inc and Red Bull amongst its customers.
Ball has been going since the 1880s and makes drinks cans as well as tins for paint and aerosols. It also has an aerospace unit.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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