Ball Makes Offer to Acquire British Aluminum Can Manufacturer Rexam

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Source: Novelis

Ball Corp., a US maker of beverage cans and jars, is in talks to acquire UK rival Rexam Plc for about 4.3 billion pounds ($6.6 billion) in what would be the industry’s largest deal.

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Ball, the largest producer of recyclable beverage cans in the world, made a cash-and-stock proposal that values Rexam at 610 pence a share, London-based Rexam said in a statement Thursday. Under UK takeover rules, Ball must decide whether to make a formal bid by March 5, Rexam said.

The offer represents a premium to Rexam’s closing price yesterday. The shares jumped as much as 29% and traded at 548 pence at 3:03 p.m. in London, Bloomberg reported.

The deal would be the largest for a metal- or glass-container maker, according to data compiled by Bloomberg, and is the latest sign of consolidation in the packaging industry. News of talks between Broomfield, Colorado-based Ball and Rexam comes a week after Rock-Tenn Co. and MeadWestvaco Corp. in the US agreed to merge to create the world’s second-largest packager.

The aluminum 3-month price saw the biggest increase at 1.3% on the LME, finishing at $1,889 per metric ton for Wednesday, February 4. On the LME, the primary aluminum cash price gained 1.0% to finish at $1,870 per metric ton. The Indian aluminum cash price inched up 0.7% to INR 116.85 ($1.90) per kilogram.

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Chinese aluminum prices were mixed for the day. Chinese aluminum scrap gained 0.8% to finish at CNY 12,500 ($1,998) per metric ton. The cash price of Chinese aluminum rose 0.8% to CNY 13,010 ($2,080) per metric ton. After a 0.8% increase, Chinese aluminum bar finished the day at CNY 13,020 ($2,081) per metric ton. For the fifth day in a row, the price of Chinese aluminum billet remained essentially flat at CNY 13,200 ($2,110) per metric ton.

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