The terms of a recommended offer by Ball to acquire all of the outstanding shares of Rexam in a cash and stock transaction had been announced.
Under the terms of the offer, for each Rexam share, Rexam shareholders will receive 407p in cash and 0.04568 new Ball shares.
The transaction values Rexam at 610p per share based on Ball’s 90-day volume weighted average price as of Feb. 17, 2015, and an exchange rate of US$1.54: £1 on that date representing an equity value of £4.3 billion (US$6.6 billion).
This represents a premium of 36% over Rexam’s closing price as of Feburary 4, 2015, the last trading day prior to media speculation concerning a potential transaction.
Upon completion of the transaction, Rexam shareholders will own approximately 19% of Ball’s fully diluted shares outstanding.
Both companies’ boards of directors unanimously support the transaction.
In addition, Ball will provide a Mix and Match Facility, which will allow Rexam shareholders to elect, subject to offsetting elections, to vary the proportions in which they receive new Ball shares and cash.
The transaction is subject to approvals from each company’s shareholders and regulatory approvals.
It is expected that the necessary clearances will be obtained in the first half of 2016.
Following closing of the transaction, Ball will remain a New York Stock Exchange listed company domiciled in the US.
Ball and Rexam represent two companies with complementary metal beverage packaging product offerings and strong cultural compatibility.
The combined company will have pro forma 2014 revenue of approximately US$15 billion and approximately 22,500 employees across five continents.
