Shareholders of consumer packaging giant Rexam are set for a windfall after the firm completed the sale of its personal care division for $709 million (£439m) yesterday.
The loss-making business was disposed of in two sections. The group sold its cosmetics, toiletries and household care products business to private equity firm Sun European Partners for $459m in cash. It said the deal has received approval from the Chinese authorities and, therefore, could be completed.
It follows the sale of its “high barrier” food container business for $250m in the summer, to Silgan Holdings.
The personal care division, which employed about 7,000 people globally and had sales of around £500m, was responsible for a £171m hit to profits in the company’s financial first half as it booked losses related to the sale. The division makes items such as lipstick cases, fragrance closures, compacts and fine-mist pumps.
In the six-month period, pre-tax profits at Rexam fell from £192m to £166m. But the firm highlighted its “underlying operating profit” from continuing operations, which was up 2 per cent at £253m.
The London-listed company’s core drinks can manufacturing operations have been boosted in recent months by an increased preference for unusual or “speciality” cans in the American market, where drinks firms have been looking to spice up the launch of their latest flavours with a unique container.
The company claims it manufactures 57 billion beverage cans each year.
Rexam had previously announced its intention to return around £370m to shareholders following completion of the disposal of the personal care business.
Yesterday, the company said the process should start on or about 8 January.
