Rexam to sell 2 divisions of its Healthcare business

Rexam PLC, a leading global beverage can maker, announces the proposed sale of the Pharmaceutical Devices and Prescription Retail Packaging divisions of its Healthcare business for $805 million in cash.

The Healthcare business has three divisions: Pharmaceutical Devices, Prescription Retail Packaging and Closures & Containers. Rexam is in discussions regarding the sale of Closures & Containers and will provide an update in due course.

Montagu Private Equity has made an offer for the Pharmaceutical Devices and Prescription Retail Packaging divisions for a total of $805 million in cash.  The transaction is subject to consultation with various European works councils and is conditional on the necessary regulatory approvals and subject to certain adjustments at completion.  The transaction is expected to complete around the middle of this year.

In 2012, Pharmaceutical Devices and Prescription Retail Packaging employed some 1,500 people and had sales of ￡250 million and underlying operating profit of ￡43 million before central overheads.  As at 31 December 2012, it had gross assets of.￡538 million.  Pharmaceutical Devices and Prescription Retail Packaging accounts for 85% of total Healthcare EBITDA.

Following completion of the sale of Pharmaceutical Devices and Prescription Retail Packaging, Rexam plans to return to shareholders around ￡450 million, which, it is anticipated, will be effected by way of a redeemable B share scheme together with a share consolidation.