Proposed Acquisition of Promens Group AS

THIS ANNOUNCEMENT (AND THE INFORMATION CONTAINED HEREIN) IS NOT FOR RELEASE, PUBLICATION, DISTRIBUTION OR FORWARDING, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN, INTO OR FROM AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA, THE UNITED STATES OF AMERICA OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION. PLEASE SEE THE IMPORTANT NOTICES AT THE END OF THIS ANNOUNCEMENT.

THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND DOES NOT CONSTITUTE A PROSPECTUS OR A PROSPECTUS EQUIVALENT DOCUMENT. NOTHING HEREIN SHALL CONSTITUTE AN OFFERING OF NEW ORDINARY SHARES. NOTHING IN THIS ANNOUNCEMENT SHOULD BE INTERPRETED AS A TERM OR CONDITION OF THE RIGHTS ISSUE. ANY DECISION TO PURCHASE, SUBSCRIBE FOR, OTHERWISE ACQUIRE, SELL OR OTHERWISE DISPOSE OF ANY NIL PAID RIGHTS, FULLY PAID RIGHTS OR NEW ORDINARY SHARES MUST BE MADE ONLY ON THE BASIS OF THE INFORMATION CONTAINED IN AND INCORPORATED BY REFERENCE IN THE PROSPECTUS ONCE PUBLISHED. COPIES OF THE PROSPECTUS WILL, FOLLOWING PUBLICATION, BE AVAILABLE FROM THE REGISTERED OFFICE OF RPC GROUP PLC AND ON ITS WEBSITE AT WWW.RPC-GROUP.COM.

27 November 2014

RPC Group Plc

Proposed Acquisition of Promens Group AS

Fully underwritten 1 for 3 rights issue to raise gross proceeds of approximately £200 million

RPC Group Plc, the international rigid plastic packaging supplier to the food and non-food, consumer and industrial markets, today announces the proposed acquisition of Promens Group AS ("Promens") for a consideration of €386 million (£307 million)1 on a cash-free, debt-free basis, subject to customary adjustments (the "Acquisition"). The consideration to be paid for Promens represents a multiple of 6.8 times 2013 EBITDA2.

Promens is a leading European manufacturer of rigid plastic packaging products and rigid plastic components, with a growing platform in emerging markets. Promens uses a range of moulding technologies in its production processes including several niche technologies. Promens' manufacturing footprint comprises 40 facilities of which 35 are located in Europe. It employs approximately 3,800 people. For the year ended 31 December 2013, Promens achieved revenues of €582 million (£462 million) and EBITDA2 of €57 million (£45 million).

RPC proposes to fund the consideration in part through a fully underwritten rights issue of up to 62,595,576 New Ordinary Shares at 320 pence each on the basis of 1 New Ordinary Share for every 3Existing Ordinary Shares to raise approximately £200 million. The balance will be funded through RPC's existing RCF, which has been increased from £350 million to £490 million. The Board expects leverage as at 31 March 2015 to be approximately 2.0 times the Enlarged Group's net debt / EBITDA2 post completion.

Highlights of the Acquisition

The Board believes that Promens represents an excellent fit for RPC and the combination of the two businesses would create a significantly enhanced European platform in rigid plastic packaging. The Acquisition also extends RPC's reach and capabilities across several end markets at once, creating significant opportunities for enhanced combined growth, scale and cost base reductions.

The Board believes that the Acquisition is attractive to RPC's shareholders and offers a number of benefits and opportunities, in particular:

· Strengthening selected market positions in core European end markets where Promens is already a well-established and highly respected player with an extensive manufacturing footprint

- Promens' operating platform is comprised of five strategic business units which are highly complementary to RPC in terms of geographies and products

· Extending RPC's geographical reach and reinforcing its presence outside Europe

- Manufacturing footprint in China that will complement RPC's existing platform in the region, established through the ACE Acquisition earlier this year

- Entry into several new countries extending support to RPC's customers

· Adding niche technologies to RPC's existing capabilities

- Promens is one of the world's leading rotational moulders serving attractive end markets

- The Acquisition adds vacuum forming, reaction injection moulding and expanded polystyrene capabilities

· Enhancing scale in European polymer buying and implementing central coordination of purchasing across the Enlarged Group

- RPC's polymer consumption is expected to increase from approximately 325,000 tonnes per annum to approximately 445,000 tonnes or 4.5 per cent. of the total European output of polymers for rigid plastic packaging

· Ongoing pre-tax cost synergies of at least €15 million (before integration costs) per annum, to be achieved by the third full financial year following Completion. Approximately half of these cost synergies are expected to be achieved in the first full year 

- The cost savings relate principally to purchasing, removal of overhead duplication and optimisation of manufacturing footprint

- An additional, one-off cash synergy of €10 million from improved working capital management is expected. This cash synergy is expected to be realised in the first full financial year of ownership

Integration costs estimated to be in region of €35 million to be incurred mainly in the first and second full years following Completion. The Acquisition is expected to enhance RPC's earnings per share in the first full financial year post Acquisition3 with Promens' ROCE4 ahead of RPC's WACC.

Pim Vervaat, Chief Executive of RPC, commented

"Today's announcement marks a key strategic milestone for RPC in line with our Vision 2020.

The combination of RPC and Promens provides a unique opportunity to create an enhanced platform of scale across our core European end markets. The enlarged group will benefit from opportunities to extend its product and technology offering across the full breadth of its combined operations as well as to achieve cost efficiencies.

RPC and Promens are a natural fit and we look forward to developing our enlarged platform to deliver superior value for our customers and shareholders in the future."

The Acquisition is conditional, amongst other things, on the approval of Shareholders of RPC at the General Meeting to be held on 17 December 2014, obtaining approvals required by the relevant governmental and competition authorities in certain jurisdictions and the Underwriting Agreement having become unconditional (other than in respect of the condition relating to Admission). The Acquisition is expected to complete by the end of March 2015.

A prospectus relating to the Acquisition and the New Ordinary Shares is expected to be published and posted to Shareholders on or around 27 November 2014. The Prospectus, when published, will be made available on RPC's website (www.rpc-group.com) and will be submitted to the National Storage Mechanism and be available for inspection at www.morningstar.co.uk/uk/nsm.do.

Details of the fully underwritten Rights Issue

RPC proposes to fund the consideration through a fully underwritten rights issue of up to 62,595,576 New Ordinary Shares at 320 pence each on the basis of 1 New Ordinary Share for every 3 Existing Ordinary Shares held on the Record Date to raise gross proceeds of approximately £200 million (approximately £195 million net of expenses).

The issue price of 320 pence per share represents a discount of 41.5 per cent. to the middle market closing price of 547 pence per Ordinary Share on 26 November 2014, being the last business day before the announcement of the Rights Issue and a 34.2 per cent. discount to the theoretical ex-rights price on that closing price, adjusted for the interim dividend for the six months ended 30 September 2014 of 5.0 pence per share which will be paid to Shareholders who are on the register of members of the Company at the close of business on 5 December 2014.

The Rights Issue has been fully underwritten by the Underwriters. The Rights Issue is being made to all Qualifying Shareholders (other than, subject to certain exemptions, the Excluded Overseas Shareholders) on the register of members of the Company at the close of business on 15 December 2014.

Analyst and investor presentation

RPC will host an analyst and investor presentation at 9:00 a.m. today at the offices of FTI Consulting, 200 Aldersgate, Aldersgate Street, London, EC1A 4HD.

Copies of this announcement and of the analyst and investor presentation on the Acquisition will be made available on RPC's website (www.rpc-group.com) today.

Notes

1 Sterling and Euro conversions based on the exchange rate of £1 : €1.26.

2 Before non-recurring items.

3 This should not be construed as a profit forecast or interpreted to mean that the future earnings per share, profits, margins or cashflows of the Group will necessarily be greater than the historic published figures.

4 Including expected pre tax cost synergies.

This summary should be read in conjunction with the full text of this announcement.

IMPORTANT NOTICE:

This announcement has been issued by, and is the sole responsibility of, RPC. The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may or should be placed by any person for any purpose whatsoever on the information contained in this announcement or on its accuracy or completeness. The information in this announcement is subject to change. Neither the contents of RPC's website nor any website accessible by hyperlinks on RPC's website is incorporated in, or forms part of, this announcement.

This announcement is not a prospectus but an advertisement and investors should not acquire any Nil Paid Rights, Fully Paid Rights or New Ordinary Shares referred to in this announcement except on the basis of the information contained in the Prospectus to be published by RPC in connection with the Rights Issue. The Prospectus will give further details of the New Ordinary Shares, the Nil Paid Rights and the Fully Paid Rights being offered pursuant to the Rights Issue. A copy of the Prospectus will be available from the registered office of RPC and on RPC's website at www.rpc-group.com. However, the Prospectus will not, subject to certain exceptions, be available (whether through the website or otherwise) to Shareholders in the United States or any other Excluded Territory.

The release, publication or distribution of this announcement in certain jurisdictions may be restricted by law and therefore persons in such jurisdictions into which these materials are released, published, distributed or forwarded should inform themselves about and observe such restrictions. The information contained herein is not for release, publication, distribution or forwarding, directly or indirectly, in or into the United States (including its territories and possessions, any state of the United States and the District of Columbia) or any other Excluded Territory. Any failure to comply with any such restrictions may constitute a violation of the securities laws of such jurisdiction.

This announcement does not contain or constitute an offer to sell or the solicitation of an offer to purchase securities to any person with a registered address in, or who is resident in, Australia, Canada, Japan, the Republic of South Africa or in any jurisdiction in which such an offer or solicitation is unlawful. None of the securities referred to herein have been or will be registered under the relevant laws of any state, province or territory of Australia, Canada, Japan or the Republic of South Africa. Subject to certain limited exceptions, none of these materials will be released, published, distributed or forwarded in or into Australia, Canada, Japan or the Republic of South Africa.

This announcement does not contain or constitute an offer for sale or the solicitation of an offer to purchase securities in the United States. The securities referred to herein have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or jurisdiction of the United States, and may not be offered or sold in the United States absent registration under the Securities Act or an available exemption from, or transaction not subject to, the registration requirements of the Securities Act. There will be no public offer of the securities in the United States. None of the New Ordinary Shares, the Form of Proxy, this announcement or any other document connected with the Rights Issue has been or will be approved or disapproved by the United States Securities and Exchange Commission or by the securities commissions of any state or other jurisdiction of the United States or any other regulatory authority, and none of the foregoing authorities or any securities commission has passed upon or endorsed the merits of the offering of the New Ordinary Shares, the Form of Proxy or the accuracy or adequacy of this announcement or any other document connected with the Rights Issue. Any representation to the contrary is a criminal offence in the United States.

This announcement includes statements that are, or may be deemed to be "forward-looking statements". The words "believe," "anticipate," "expect," "intend," "estimate", "forecast", "project", "aim,", "hope", "plan," "seek", "predict," "continue," "assume," "positioned," "may," "will," "should," "shall," "risk" , "assurance" and other similar expressions that are predictions of or indicate future events and future trends identify forward-looking statements. Others can be identified from the context in which they are made. These forward-looking statements include all matters that are not historical facts. An investor should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties and other factors that are in many cases beyond the Company's control. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The Company cautions investors that forward-looking statements are not guarantees of future performance and that its actual results of operations and financial condition, and the development of the industry in which it operates, may differ materially from those made in or suggested by the forward-looking statements contained in this announcement. The cautionary statements set forth above should be considered in connection with any subsequent written or oral forward-looking statements that the Company, or persons acting on its behalf, may issue. Factors that may cause the Company's actual results to differ materially from those expressed or implied by the forward-looking statements in this announcement include but are not limited to the risks described under "Risk Factors" in the Prospectus.

These forward-looking statements reflect the Company's judgment at the date of this announcement and are not intended to give any assurances as to future results. Furthermore, forward-looking statements contained in this announcement that are based on past trends or activities should not be taken as a representation that such trends or activities will continue in the future. No statement in this announcement is intended to be a profit forecast or to imply that the earnings of the Group for the current year or future years necessarily will match or exceed the historical or published earnings of the Group.

The Company will comply with its obligations to publish updated information as required by FSMA, the Listing Rules, the Disclosure and Transparency Rules and/or the Prospectus Rules or otherwise by law and/or by any regulatory authority, but assumes no further obligation to publish additional information. 

You are advised to read this announcement and, once published, the Prospectus in their entirety for a further discussion of the factors that could affect the Company's future performance. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements in this announcement may not occur.

Rothschild, Deutsche Bank and HSBC, which are each authorised by the Prudential Regulation Authority and regulated (in the case of Deutsche Bank only, to a limited degree by both Prudential Regulation Authority and the FCA) by the FCA and Panmure Gordon, which is authorised and regulated by the FCA in the United Kingdom are acting solely for the Company in relation to (in the case of Rothschild only) the Acquisition and (in the case of each of the Banks) the Rights Issue and nobody else and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients nor for providing advice in relation to the Acquisition and the Rights Issue or any other matter referred to in this announcement.

Apart from the responsibilities and liabilities, if any, which may be imposed upon the Banks, by FSMA or the regulatory regime established thereunder, none of the Banks accepts any responsibility whatsoever or makes any representation or warranty, express or implied, concerning the contents of this announcement, including its accuracy, completeness or verification, or concerning any other statement made or purported to be made by it, or on its behalf, in connection with the Company, the New Ordinary Shares, the Acquisition or the Rights Issue, and nothing in this announcement is, or shall be relied upon as, a promise or representation in this respect, whether as to the past or future. Each of the Banks accordingly disclaims, to the fullest extent permitted by law, all and any responsibility and liability whether arising in tort, contract or otherwise (save as referred to herein) which each of them might otherwise have in respect of this announcement or any such statement.

Recipients of this announcement and/or the Prospectus should conduct their own investigation, evaluation and analysis of the business, data and property described in this announcement and/or, if and when published, in the Prospectus. This announcement does not constitute a recommendation concerning any investor's options with respect to the Rights Issue. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. The contents of this announcement are not to be construed as legal, business, financial or tax advice. Each shareholder or prospective investor should consult with his or her or its own legal adviser, business adviser, financial adviser or tax adviser for legal, financial, business or tax advice.

Persons in Excluded Territories, including persons in the United States who are QIBs, may be eligible to participate in the Rights Issue pursuant to an available exemption from registration or other public offering requirements and should contact the Registrars' Shareholder Helpline on 0871 384 2479 (from within the United Kingdom) or on +44 121 415 0866 (if calling from outside the United Kingdom) for further information. Calls to the 0871 384 2479 number are charged at 8 pence per minute (excluding VAT) or plus network extras. Calls to the Shareholder Helpline from outside the United Kingdom will be charged at the applicable international rate. Lines are open from 8.30 a.m. to 5.30 p.m. (London time) Monday to Friday (except UK public holidays). Different charges may apply to calls from mobile telephones and calls may be recorded and randomly monitored for security and training purposes. Please note that the Shareholder Helpline operators cannot provide advice on the merits of the Rights Issue nor give financial, tax, investment or legal advice.

Further information in relation to the Acquisition and the proposed Rights Issue

1. Introduction

RPC announces that it has granted a conditional put option pursuant to which it can be required to acquire Promens, a leading European manufacturer of rigid plastic products for a wide range of end markets, for a consideration of €386 million (approximately £307 million)1 on a cash-free, debt-free basis. The consideration to be paid for Promens represents a multiple of 6.8 times 2013 EBITDA2.

The Acquisition represents a significant opportunity for RPC to extend its reach and capabilities in European rigid plastic packaging across several end markets. Promens' extensive footprint in Europe is highly complementary to RPC's, creating possibilities for higher combined growth and reductions in the combined cost base. The Acquisition is an excellent fit with RPC's Vision 2020 objectives and meets RPC's strict acquisition criteria. The Board believes that RPC will benefit from greater product diversification, a broadened customer base, and an enlarged platform to generate efficiency savings and an improved purchasing position as a result of the Acquisition, that together will create long-term value for Shareholders.

RPC proposes to fund the Acquisition through a mixture of equity (by way of a fully underwritten Rights Issue) and debt. The Rights Issue at a price of 320 pence per share will raise gross proceeds of approximately £200 million. The Rights Issue will be on the basis of 1 New Ordinary Share for every 3 Existing Ordinary Shares held on the Record Date. The balance will be funded through drawings on RPC's existing RCF, which has been increased from £350 million to £490 million.

The Rights Issue is conditional, among other things, upon the passing of the Resolutions, Admission and the Underwriting Agreement having become unconditional in all respects (other than conditions referring to Admission) and not having been terminated in accordance with its terms prior to Admission. The Rights Issue is not conditional on Completion. However if, before Admission, the Put Option Agreement or, if applicable, the Acquisition Agreement has terminated, or the conditions to the Acquisition cease to be capable of satisfaction, the Rights Issue will not proceed.

In the event that the Acquisition does not complete, but the Rights Issue has completed, RPC will use the proceeds of the Rights Issue for general corporate purposes and (where possible) acquisitions that fulfil the Company's clear strategic objectives. To the extent that after six months following Admission, opportunities for such acquisitions have not been identified by the Board, the Board will review RPC's funding structure and will consider its options, which will include the return of surplus cash to its shareholders in as tax efficient a manner as possible.

As a result of its size, the Acquisition is conditional upon, among other things, the approval of Shareholders. RPC shareholder approval will also be sought for the necessary authority to issue New Ordinary Shares pursuant to the Rights Issue. Accordingly, resolutions to approve the Acquisition and to seek such authority will be proposed at a General Meeting of the Company to be held at 12 noon on 17 December 2014 at the offices of Latham & Watkins (London) LLP, 99 Bishopsgate, London EC2M 3XF, United Kingdom.

2. Summary information on Promens

Promens is a leading European manufacturer of rigid plastic packaging products for the chemicals, personal and healthcare and food markets as well as rigid plastic components primarily for the commercial and industrial vehicles industry, with a growing platform in emerging markets. Promens uses a wide range of moulding technologies in its production processes including blow moulding (approximately 37 per cent. of 2013 revenue), injection moulding (27 per cent.) and thermoforming (12 per cent.) and is one of the world's leading manufacturers of rotational moulded products (17 per cent.). Other technologies used by Promens include vacuum forming, reaction injection moulding and expanded polystyrene (in aggregate, 7 per cent.).

Promens was established approximately 30 years ago and since then has grown both organically and through a number of acquisitions. For the year ended 31 December 2013, Promens achieved revenues of €582 million (£462 million) and EBITDA2 of €57 million (£45 million). Promens employs approximately 3,800 people.

Promens operates through 40 production facilities that span 20 countries across Europe (35), North America (1), Asia (3) and Africa (1). For the year ended 31 December 2013 revenues by destination were approximately split across Europe (94 per cent.), Asia (4 per cent.), the Americas (2 per cent.), and Africa (less than 1 per cent.).

Promens operates through five strategic business units, three of which focus on packaging related products:

Packaging

· The Chemical business (approximately 27 per cent. of 2013 revenue3) offers packaging solutions for bulk and specialty chemicals, lubricants, coatings, fragrance, and agrichemical markets throughout Europe. Products include jerry cans, canisters and drums;

· The Personal & Healthcare business (approximately 21 per cent. of 2013 revenue3) offers packaging solutions spanning a wide range of personal care market applications including the prestige, masstige and mass market sub-segments in Europe, as well as niche products for the global pharmaceutical market. Products include bottles, jars and tubes; and

· The Food & Beverage business (approximately 19 per cent. of 2013 revenue3) offers packaging solutions for fresh and chilled foods, dairy and liquids throughout Europe. Products include jars, pots, spoons, and caps.

Rotational Moulding

· The Rotational Moulding business (approximately 17 per cent. of 2013 revenue3,4) focuses largely on fuel tanks for public service, construction and marine vehicles as well as insulated tubs for the global fishing industry and bulky containers for the chemical and food industries in Europe.

Vehicles

· The Vehicles business (approximately 16 per cent. of 2013 revenue3,4) manufactures interior and exterior components for trucks.

Promens is primarily owned by two Icelandic investment companies; Eignarhaldsfelag Landsbankans ehf., a subsidiary of the Icelandic bank Landsbankinn, and Framtakssjodur Islands slhf., majority owned by Icelandic pension funds. Promens is headquartered in Reykjavik, Iceland, reflecting the location of its shareholders.

3. Background to and reasons for the Acquisition

Strategy

Today, RPC is a leading supplier of rigid plastic packaging with over 55 operations in 19 countries. In November 2013, the Group announced 'Vision 2020', a focused growth strategy to build on RPC's strong market positions, leading innovation capabilities and the success of its investments over recent years.

Vision 2020 includes three core strategic elements:

· Continued focus on organic growth - in recognition of the leading market positions that RPC enjoys as a result of ongoing investment in process and product innovation;

· Selective consolidation in Europe - in recognition of the significant value creation potential that could be achieved by acquiring high quality businesses in RPC's existing core geographic markets; and

· The creation of a meaningful presence outside of Europe - in recognition of the continued higher rates of growth in certain emerging and other regions outside of Europe.

One of the key areas of focus within RPC's growth strategy is to further strengthen the Group's positioning in Europe, a market that remains relatively fragmented with few strategic players of scale, building on the successful acquisitions of Superfos in 2010 and more recently M&H Plastics and Helioplast in 2013. The Group pursues acquisition opportunities that it believes will complement its existing businesses through expansion into complementary products and access to new geographical markets within Europe where enhanced returns could be achieved, in order to create value for Shareholders.

Rationale for the Acquisition of Promens

The Board believes that Promens represents an excellent fit for RPC and the combination of the two businesses would create a significantly enhanced European platform in rigid plastic packaging. The Acquisition also extends RPC's reach in several niche end markets at once, creating significant opportunities for enhanced combined growth and scale. The Board believes that the Acquisition is attractive to RPC's shareholders and offers a number of benefits and opportunities, in particular:

(a) Further strengthening of European market position

Promens is a well-established and highly respected market player with a well invested European manufacturing footprint. The Acquisition will strengthen RPC's existing operating platform in Europe where there is high complementarity in terms of geographies and products between the two players.

(b) Strengthening of selected market positions in core European end markets

Promens operates across five strategic business units that are complementary to RPC:

· Chemical: serves some of the leading chemical companies and distributors in Europe, where RPC is currently a small player. The segment has facilities in areas in close proximity to relevant ports and where there is a high concentration of chemical producers, including the large chemical clusters in Northern and South-Western Germany, North-West UK and Belgium. The Acquisition will establish RPC as a meaningful player in the chemicals packaging market.

· Personal & Healthcare: has a diverse customer base including global consumer and healthcare companies and local Western and Eastern European brands. Customers in personal care include some of the fastest growing and most innovative companies who value extensive design and technical expertise and continuous product development. Promens has a track record of innovation in this field and benefits from being located in close proximity to customers' centres of excellence and filling locations in France. Promens has demonstrated a track record of growth across its Eastern European facilities in Poland and Russia. The Acquisition extends RPC's reach in this market through new products and customers as well as extending partnerships with existing customers.

· Food & Beverage: has a strong customer base comprised of some of the leading regional and local brands in Scandinavia. The Acquisition strengthens RPC's presence in the region established following the Superfos acquisition with a number of global and local blue chip customers.

· Rotational Moulding: the Acquisition broadens RPC's technology portfolio with the addition of rotational moulding capabilities, in which Promens is one of the world's leading manufacturers with good footprint outside of Europe. The manufactured components are supplied to the fishing, agricultural and commercial vehicles sectors. The Acquisition offers further potential for RPC to extend rotational moulding to other end markets where it is currently present.

· Vehicles: Promens has a leading position in reaction injection moulding technology for the commercial vehicles industry with its low-cost operation in Estonia supporting the value-adding product development in Holland. The Acquisition further diversifies RPC in attractive niche markets with global customers and is complementary to RPC's operations in China via ACE.

(c) Reinforces presence outside of Europe

Promens operates a manufacturing facility in Taicang, China within Rotational Moulding and is in the process of opening a manufacturing facility in Hefei within Personal Care. This Chinese manufacturing footprint will complement RPC's existing platform in the region, established through the ACE Acquisition earlier this year. Promens also operates manufacturing facilities in other countries where RPC is not currently present, including Russia, Canada and India, as well as the Czech Republic and Estonia within Europe. The Acquisition will reinforce RPC's growing presence outside of Europe, one of the key pillars of RPC's Vision 2020 strategy, enabling the Group to better serve its global clients' requirements, particularly in the high growth emerging market economies.

(d) Higher operating margins through manufacturing optimisation and purchasing and cost synergies

The Board expects that ongoing annual pre-tax cost synergies of at least €15 million per annum should be achievable by the third year following Completion, of which approximately half is expected to be achieved in the first full year following Completion. These cost synergies are principally related to polymer purchasing (particularly in Europe), the removal of overheads duplication, including head office functions, and optimisation of the Group's manufacturing footprint. Realisation of synergies is anticipated to require a cash outlay of approximately €35 million expected to be incurred mainly in the first and second full years of ownership. It is expected that there will be an additional one-off cash synergy of €10 million arising from improved working capital management as Promens' practices are brought into line with RPC's more efficient system; it is anticipated that this synergy will be achieved within the first full financial year of ownership. There is also scope for cash savings relating to capital expenditure as the investment plans of both RPC and Promens are aligned thereby eliminating any duplicate planned expenditure. The quantum and timing of such capital expenditure synergies remains to be determined. There will be no costs associated with the realisation of additional one-off cash synergies.

(e) Adding niche technologies

Promens is one of the world's leading rotational moulders serving attractive end markets. The Acquisition also adds vacuum forming, reaction injection moulding and expanded polysterene capabilities.

(f) Enhancing scale in polymer buying

RPC currently purchases approximately 325,000 tonnes of polymer per annum, while Promens purchases approximately 120,000 tonnes of polymer per annum, with both companies sharing the same key suppliers. The Enlarged Group's polymer consumption is expected to equate to approximately 4.5 per cent. of the total European output of polymers for rigid plastic packaging. Following Completion, RPC intends to centrally co-ordinate the purchase of polymers across the Enlarged Group, rolling out its own optimised purchasing strategy.

The Acquisition represents a significant step in RPC's strategy for growth in the rigid plastic packaging industry through selective consolidation in Europe. In line with Vision 2020, the Board continues to evaluate potential acquisition opportunities which could also generate significant value for Shareholders.

4. Overview of the Acquisition

The RPC Buyer has granted an irrevocable binding put option to the Promens Seller entitling it to require the RPC Buyer to purchase Promens from the Promens Seller for a consideration of €386 million (approximately £307 million) on a debt-free, cash-free basis. RPC would also assume Promens' net pension liabilities.

Before the Promens Seller takes any definitive decision to proceed with the Acquisition, French law requires it to consult with the Works Councils with a view to obtaining their opinions on the transaction in such a way as to ensure the effectiveness of the consultation. Accordingly, the RPC Buyer and the Promens Seller have entered into the Put Option Agreement, pursuant to which the RPC Buyer has granted an irrevocable binding put option to the Promens Seller entitling it to require the RPC Buyer to purchase Promens from the Promens Seller on the terms and subject to the conditions set out in the Acquisition Agreement. Until such time as the Promens Seller exercises the Put Option and enters into the Acquisition Agreement, it is under no legal obligation to proceed with the Acquisition. This structure enables Promens to comply with the legal requirements in France for mandatory works council consultations and gives the Works Councils time to fully consider the Acquisition before any decision is taken by the Promens Seller. The statutory period applicable to the consultation process in France is two months from the receipt of the necessary documents by the Works Council and the Put Option can be exercised within 120 days from signing. The Promens Seller is expected to exercise the Put Option and execute the Acquisition Agreement once the consultation procedures with the Works Councils are completed. If the Promens Seller does not exercise the Put Option within 5 business days of the completion of the information and consultation processes with each of the Works Councils, Promens Group AS will reimburse the RPC Buyer all costs incurred by the RPC Group with respect to the Acquisition.

Pursuant to the Acquisition Agreement, Completion will be conditional upon the approval of the Acquisition by RPC's shareholders, no material adverse change in respect of Promens as specified in the Acquisition Agreement having occurred in the period specified in such agreement, the obtaining of approvals required by the relevant governmental and competition authorities in certain jurisdictions and the Underwriting Agreement having become unconditional (other than in respect of the condition relating to Admission). If the conditions to Completion have not been satisfied or waived by the Acquisition Long Stop Date, the Acquisition Agreement may be terminated.

The Acquisition Agreement will include a customary anti-leakage covenant from the Promens Seller in respect of the period between 31 March 2014 and Completion. Warranties in relation to various aspects of the Promens Group and its business will be given to the RPC Buyer. The Promens Seller's liability in respect of these warranties is subject to certain limitations, including time and financial limitations.

The Acquisition and associated expenses will be funded from the proceeds of the Rights Issue and amounts drawn down under the RCF.

As part of the Acquisition, the RPC Buyer will be granted an option to acquire the Promens medical business unit from the Promens Seller for DKK 1, subject to customary adjustments. This option will expire on 30 June 2015. The medical business unit supplies pharmaceutical packaging, including intravenous bags and plastic vials. The business is based in Langeskov, Denmark, has 88 employees and had sales of approximately €12 million (£10 million) in 2013. Promens is currently rebuilding the base-load business with a focus on more resilient product lines and the Directors believe that the business could potentially form an attractive addition to RPC's existing pharmaceutical business.

The Acquisition is expected to complete by the end of March 2015.

Following Completion, RPC intends to complement its own business improvement capability with additional reorganisation specialists.

5. Current trading and prospects

RPC

RPC's results for the six months ended 30 September 2014 were in line with expectations and showed satisfactory profit growth, despite the impact of the foreign exchange translation headwind, the time lag in passing through high polymer prices and a generally flat economic growth environment, particularly in mainland Europe.

Revenues from continuing operations for the six months ended 30 September 2014 grew by 12 per cent. compared to the corresponding period in 2013, to £589 million, reflecting the contribution from recent acquisitions and an increase of 4 per cent. in like-for-like sales. Adjusted operating profit for the period was £60.9 million, a £13.8 million, or 29 per cent., increase on the £47.1 million adjusted operating profit for the six months ended 30 September 2013. RPC incurred £16.1 million of exceptional restructuring costs, impairments and exceptional items in the six months ended 30 September 2014, compared to £9.5 million in the corresponding period in 2013, mainly relating to the final phase of the Fitter for the Future business optimisation programme and costs relating to recent acquisitions.

The Company's Vision 2020 strategy is well progressed, with the acquisition of ACE successfully completed in June 2014 and continued with the announcement today of the expected acquisition of Promens.

The Company's 'Fitter for the Future' programme is now nearing completion with the Offenburg (Germany) business and the two sheet businesses in Lokeren (Belgium) and Montonate (Italy) having been disposed of. The integration of the M&H Plastics and Helioplast businesses has been successfully completed, whilst the integration of the ACE business is making good progress, with both packaging and non-packaging customers confirming the strategic growth potential.

The Board considers that the Group's performance in the six months ended 30 September 2014 is encouraging against the backdrop of a continuing challenging economic environment in the Eurozone. RPC will continue to invest in existing and new businesses as it implements its Vision 2020 focused growth strategy. The second half of the financial year to 31 March 2015 has started satisfactorily and RPC remains well placed to benefit from any economic recovery in Europe.

Promens

Promens' trading has remained satisfactory despite headwinds in several of its markets. The continued economic and political uncertainty, in Europe in particular, has delayed timing of certain customer projects and resulted in some volume compression. The business has made good operational progress since the start of the year, continuing with focused investments and project developments within and outside of Europe.

For the period 1 January to 30 September 2014, Promens achieved sales of €436.8 million and EBITDA before non-recurring items of €40.6 million as stated in the unaudited Promens internal management accounts. In the same period in 2013, sales were €441.6 million and EBITDA before non-recurring items was €45.1 million. Volumes were impacted by certain project delays and softening in some end markets. The continued focussed investment in emerging markets, especially China, and the consolidation of Promens' German chemical operations impacted profitability downwards in 2014 compared to the previous year. However these were partially offset by reduced polymer prices, with some time lag before these changes are passed to customers, as well as operational and cost efficiencies achieved across the business. Profitability in the period also reflects a continuing investment in a cost base geared towards Promens' organic growth plans.

Promens has a broad manufacturing and customer base supported by its on-going investment programme enabling the business to withstand some of the current market headwinds and to maintain its differentiated market position. Promens has a good product development pipeline driven by on-going requirements for new packaging solutions. The Board views the trading prospects of Promens for the remainder of the year and beyond with confidence.

6. Dividend and dividend policy

The New Ordinary Shares will, following allotment and issue, rank pari passu in all respects with the Existing Ordinary Shares and rank in full for all dividends and other distributions declared in respect of the ordinary share capital of RPC, save as provided below in respect of the interim dividend for the six months ended 30 September 2014.

The Board intends to continue with its progressive dividend policy with a target dividend cover level through the cycle of 2.5x. The Group's dividend policy will take into account the discount element of the Rights Issue.

For the year ended 31 March 2014 the Company paid a dividend of 15.5 pence per share (year ended 31 March 2013: 14.9 pence per share and year ended 31 March 2012: 14.4 pence per share), representing an increase of 4 per cent. compared to the year ended 31 March 2013.

For the six month period ended 30 September 2014, the Board has declared an interim dividend of 5.0 pence per share (2013: 4.5 pence per share), representing an 11 per cent. increase on the 2013 interim dividend. Holders of New Ordinary Shares issued pursuant to the Rights Issue will not be entitled to receive the interim dividend of 5.0 pence per share. The record date for the interim dividend is 5 December 2014.

The Group may revise its dividend policy from time to time.

7. Financial impact of the Acquisition and Rights Issue

The Board expects the Acquisition and Rights Issue to enhance RPC's earnings per share (adjusted for the discount element of the Rights Issue) in the first full financial year post Acquisition. This statement should not be interpreted to mean that the future earnings per share of RPC will necessarily match or exceed its historical published earnings per share. Together with the pre-tax synergies outlined below, Promens' ROCE5 is ahead of RPC's WACC of approximately 9 per cent. and Promens' RONOA5 was approximately 25 per cent. in 2013.

The Board estimates that the total pre-tax cost synergies from the Acquisition will be at least €15 million per annum (before integration costs as detailed below), to be achieved within the third full financial year of ownership, of which approximately half is expected to be achieved in the first full year of ownership. All synergies are expected to be reflected in the cash flow. These synergies are expected to be realised from cost reduction, principally through purchasing optimisation (particularly in Europe), as well as through the elimination of duplicate head office costs and other functions, efficiency savings, transfer of best practice and limited manufacturing rationalisation. However, there can be no assurance that such synergies can be achieved in the time frame or at all.

Realisation of synergies is expected to require a cash outlay of approximately €35 million to be incurred mainly in the first and second full financial years following Completion. There can be no assurance that such savings can be achieved in the time frame or at all. This statement of estimated cost savings relates to future actions and circumstances which by their nature involve risks, uncertainties, contingencies and other factors. As a result, the cost savings referred to may not be achieved, or those achieved may be materially different from those estimated. The figures as set out in this paragraph are unaudited numbers based on management estimates. The estimated synergies are contingent on the Acquisition completing and could not be achieved independently. The estimated synergies reflect both beneficial elements and relevant costs.

The Board also estimates that there will be an additional one-off cash synergy of €10 million as a result of improved working capital management of Promens as Promens' practices are brought into line with RPC's more efficient system; it is anticipated that this synergy will be achieved within the first full financial year of ownership. There is also scope for cash savings relating to capital expenditure as the investment plans of both RPC and Promens are aligned thereby eliminating any duplicate planned expenditure. The quantum and timing of such capital expenditure synergies remains to be determined. There would be no costs associated with implementing these one-off cash synergies. This statement of estimated one-off cash synergies relates to future actions and circumstances which by their nature involve risks, uncertainties, contingencies and other factors. As a result, the cash benefits referred to may not be achieved, or those achieved may be materially different from those estimates. The figures as set out in this paragraph are unaudited numbers based on management estimates. The estimated synergies are contingent on the Acquisition completing and could not be achieved independently. The estimated synergies reflect both beneficial elements and relevant costs.

The Board expects leverage as at 31 March 2015 to be approximately 2.0 times the Enlarged Group's net debt/EBITDA.

8. Increase of RCF

RPC has increased its existing multicurrency revolving credit facility with seven UK and European banks as joint arrangers and joint lenders with Commerzbank AG, London Branch as agent from £350 million to £490 million. The amended and restated RCF Agreement is on substantially the same terms as the agreement entered into on 30 April 2014. If the Acquisition does not complete, the additional £140 million of the RCF will be cancelled.

9. Principal terms and conditions of the Rights Issue

The Company is proposing to raise approximately £195 million (net of expenses), by way of the Rights Issue. The Issue Price of 320 pence per New Ordinary Share, which is payable in full on acceptance by not later than 11.00 a.m. on 7 January 2015, represents a 41.5 per cent. discount to the closing middle market price of an Existing Ordinary Share on 26 November 2014 (being the last business day before the announcement by RPC of the Rights Issue) and a 34.2 per cent. discount to the theoretical ex-rights price of an Existing Ordinary Share based on that closing price, adjusted for the interim dividend for the six months ended 30 September 2014 of 5.0 pence per share which will be paid to Shareholders who are on the register of members of the Company at the close of business on 5 December 2014. The level of this discount was determined by the Directors according to market conditions and shareholder feedback in respect of the Rights Issue.

Subject to the fulfilment of, amongst others, the conditions set out below, the Company will offer up to 62,595,576 New Ordinary Shares by way of the Rights Issue to Qualifying Shareholders at 320 pence per New Ordinary Share payable in full on acceptance. The Rights Issue will be on the basis of:

1 New Ordinary Share for every 3 Existing Ordinary Shares

held by Qualifying Shareholders on the Record Date, and so in proportion to any other number of Existing Ordinary Shares then held and otherwise on the terms and conditions set out in the Prospectus and, in the case of Qualifying non-CREST Shareholders only (other than, subject to certain exemptions, Excluded Overseas Shareholders), the Provisional Allotment Letter. Holdings of Existing Ordinary Shares in certificated and uncertificated form will be treated as separate holdings for the purpose of calculating entitlements under the Rights Issue. Fractional entitlements to New Ordinary Shares will not be allotted and, where necessary, entitlements will be rounded down to the nearest whole number of New Ordinary Shares.

The New Ordinary Shares will, when issued and fully paid, rank pari passu in all respects with the Ordinary Shares including the right to all future dividends and other distributions declared, made or paid.

The Rights Issue is conditional upon, amongst other things:

a) the passing without amendment of the Resolutions at the General Meeting;

b) the Put Option Agreement not having been terminated, varied, modified, supplemented or lapsing, prior to Admission, and none of the conditions to the Acquisition in the Put Option Agreement or the Acquisition Agreement not being satisfied or becoming incapable of satisfaction, prior to Admission;

c) the Company having applied to Euroclear for admission of the Nil Paid Rights and Fully Paid Rights to CREST as participating securities and no notification having been received from Euroclear on or before Admission that such admission or facility for holding and settlement has been or is to be refused;

d) Admission becoming effective by not later than 8.00 a.m. (London time) on 18 December 2014 (or such later time and/or date as the Company, Rothschild and the Joint Bookrunners may agree, being not later than 8.00 a.m. (London time) on 31 January 2015); and

e) the Underwriting Agreement having become unconditional prior to Admission (save for the condition relating to Admission) and not having been terminated in accordance with its terms prior to Admission.

Shareholders should note that the Rights Issue is not conditional upon Completion and that, subsequent to the Rights Issue becoming wholly unconditional, the Promens Seller could fail to exercise the Put Option and enter into the Acquisition Agreement and/or the Acquisition could fail to complete.

Clearances will be sought from the relevant competition authorities in France, Germany, Poland and Russia. The Board believes that competition clearances will be received from all of these competition authorities. If competition clearance is not received from the authorities in any of France, Germany, Poland and Russia, the Acquisition may not complete. In the event that the Acquisition does not complete, RPC will use the proceeds of the Rights Issue for general corporate purposes and (where possible) acquisitions that fulfil the Company's clear strategic objectives. To the extent that after six months following Admission, opportunities for such acquisitions have not been identified by the Board, the Board will review RPC's funding structure and will consider its options, which will include the return of surplus cash to its shareholders in as tax efficient a manner as possible.

Applications have been made to the FCA for the New Ordinary Shares to be admitted to the premium segment of the Official List and to the London Stock Exchange for the New Ordinary Shares to be admitted to trading on its main market for listed securities. It is expected that Admission will become effective and dealings (for normal settlement) in the New Ordinary Shares will commence, nil paid, at 8.00 a.m. on 18 December 2014.

The Underwriters have conditionally agreed to procure subscribers or, failing which, themselves to subscribe for the New Ordinary Shares (other than those referred to in the next paragraph) not taken up in the Rights Issue at a price of 320 pence per share.

Based on the share capital of the Company on 26 November 2014 (the latest practical date before this announcement), up to 62,595,576 New Ordinary Shares will be offered pursuant to the Rights Issue and this number of New Ordinary Shares has been underwritten by the Underwriters. If, as at the Record Date, further Ordinary Shares have been issued pursuant to the exercise of any options, the number of New Ordinary Shares offered under the Rights Issue would increase. Any such additional New Ordinary Shares will not be underwritten.

The latest time and date for acceptance and payment in full under the Rights Issue is expected to be 11.00 a.m. on 7 January 2015.

10. Directors' intentions

The Directors are fully supportive of the Rights Issue. Each of the Directors who holds Ordinary Shares either intends, to the extent that he or she is able, to take up in full his or her rights to subscribe for New Ordinary Shares under the Rights Issue or to sell a sufficient number of his or her Nil Paid Rights during the Nil Paid Rights trading period to meet the costs of taking up the balance of his or her entitlements to New Ordinary Shares.

11. General Meeting

The General Meeting will be held at the offices of Latham & Watkins (London) LLP, 99 Bishopsgate, London EC2M 3XF, United Kingdom on 17 December 2014 at 12 noon. The purpose of this meeting is to consider and, if thought fit, pass the resolution relating to the Acquisition which is numbered 2 in the GM Notice (the "Acquisition Resolution") and the resolution relating to the Rights Issue which is numbered 1 in the GM Notice (the "Rights Issue Resolution"), in each case as set out in the GM Notice. Shareholders are being asked to vote on the Rights Issue Resolution in order to provide the Directors with the necessary authority and power under the Companies Act to proceed with the Rights Issue. Shareholders are being asked to vote on the Acquisition Resolution because the Acquisition is classified as a Class 1 transaction for the purpose of the Listing Rules and therefore requires the approval of Shareholders.

First Resolution

The first Resolution is to authorise the Directors pursuant to section 551 of the Companies Act to allot shares and grant rights to subscribe for, or convert any security into, shares up to an aggregate nominal amount of £3,129,779, in connection with the Rights Issue representing approximately 33.3 per cent. of the existing issued share capital of the Company. The authority and power conferred by the first Resolution shall expire 12 months from the date of the passing of this Resolution unless previously revoked or renewed, save that the Company may before such expiry make an offer or agreement which would or might require shares to be allotted or rights to be granted after such expiry and the Directors may allot shares, or grant rights to subscribe for or to convert any securities into shares, in pursuance of such offer or agreement as if the authority conferred by this resolution had not expired. The authority and power conferred by the first Resolution is supplementary to the existing authority granted at the Company's annual general meeting on 16 July 2014.

The Directors intend to use these authorities to allot New Ordinary Shares pursuant to the Rights Issue. Other than in connection with the Rights Issue, and upon the exercise of options under the Share Option Schemes, the Directors have no present intention to utilise these authorities.

Second Resolution

The second Resolution is to approve the Acquisition pursuant to the requirements of the Listing Rules.

12. Financial advice

The Board has received financial advice from Rothschild in relation to the Acquisition. In providing its advice to the Board, Rothschild has relied on the Directors' commercial assessment of the Rights Issue and the Acquisition.

13. Recommendation

The Board considers the Rights Issue and the Acquisition to be in the best interests of the Company and Shareholders as a whole. Accordingly, the Board unanimously recommends that you vote in favour of the Resolutions to be proposed at the General Meeting as the Directors and persons connected to them intend to do in respect of their entire holdings, amounting to 463,250 Ordinary Shares in aggregate as at the Latest Practicable Date (representing approximately 0.25 per cent. of the Company's existing issued ordinary share capital).

Notes

1 Sterling and euro conversions based on the exchange rate of £1 : €1.26.

2 Before non-recurring items.

3 Segment revenues are stated before corporate adjustments.

4 Based on expected reporting under RPC ownership.

5 Including expected pre tax cost synergies.

Definitions

The following definitions apply throughout this announcement, unless the context otherwise requires