EUROPE’S largest drinks can maker Rexam said yesterday it was considering selling its personal care packaging business after its continued weak performance, and said tough economic conditions in its key markets would make 2012 a challenging year.
“Performance in personal care continued to be weak and we are now exploring all options for this segment of plastic packaging, including divestment, to improve returns and maximise shareholder value,” Rexam’s chief executive Graham Chipchase said.
In June, City A.M. revealed that Rexam was offloading its bottling unit to Berry Plastics (right), a manufacturer majority-owned by US private equity giant Apollo for £220m.
The British firm, which makes Red Bull and PepsiCo cans as well as packaging for food, healthcare and cosmetic products, said 2012 would be a tough because of lower GDP growth in several of its major markets, while its European beverage cans unit would have to absorb some £20m of higher metal conversion costs.
It will also be hit by a key healthcare product coming off patent. Rexam said its beverage packaging unit, which makes around 80 per cent of its sales, producing 60bn cans each year, was on track to deliver an improved operating profit in 2011, as growth in its North American specialty cans business helped offset softer volumes in Russia.
City A.M. Reporter