Beverage and food can producer Ball Corporation (Broomfield, Colorado / USA; www.ball.com) plans to acquire its smaller competitor Rexam (London / UK; www.rexam.com) for GBP 4.3 bn (about EUR 5.8 bn). Ball intends to close the purchase by H1 2016. The deal would create a packaging giant with pro forma sales of about USD 15 bn (EUR 13.2 bn) and 22,500 employees. According to a recent white paper by researcher Smithers Pira (Leatherhead, Surrey / UK; www.smitherspira.com), if the deal goes through, Ball will hold a majority share of the metal can market, accounting for about 40% of total value. This position would give it a leading role in the future development of the metal packaging industry, the paper said.

The transaction still has to be approved by the competition authorities, and it seems that Ball is expecting both the US and European cartel offices to impose a few conditions. After all, the proposed new company’s share of metal-based drinks packaging would amount to close to 60% in the US and almost 70% in Europe.

Ball hopes the acquisition will make its portfolio more competitive vis-a-vis glass and PET bottles. By adding Rexam, the US group also intends to offer its customers – most of which are self-sufficient – better conditions. Group CEO John Hayes said synergy effects of the deal are expected to yield about USD 300m per annum, following an initial three-year period.

Rexam sold off its last remaining plastics activities in early 2014 (see Plasteurope.com of 25.03.2014). Ball still engages in some small-scale blow moulding activities in Asia.