Rexam unveils its 350m cash call
REXAM, Europe’s biggest drinks can maker, yesterday announced a fully underwritten £350.7m cash call to protect its investment grade credit rating.
The company, which manufactures cans for Pepsi Bottling Group and Red Bull, is the first firm to launch a rights issue to maintain its credit rating, rather than from a distressed or opportunistic position.
The group said the four for 11 rights issue of 234m new shares will be priced at 150p, a 25.7 per cent discount to Tuesday’s closing price of 276.25p. The new shares are expected to be at a 38.25 per cent discount to the theoretical ex-rights price.
The rights issue is underwritten by long-term advisers RBS Hoare Govett and Citi. Boutique investment bank Greenhill, who is advising, was hired a matter of weeks before yesterday’s announcement.
The group yesterday axed its dividend to conserve its cash reserves as the group warned it could see “no upturn in current trading conditions through 2009”.
JAMES LUPTON
GREENHILL
ADVISER TO REXAM
GREENHILL, the boutique investment bank was retained specifically by Rexam’s directors for financial advice on its cash call.
James Lupton joined the the New York-based parent company in 1998 after setting up its London office along with director Simon Borrows.
Both had held senior roles in the corporate finance division of Barings, the investment bank now part of ING . Lupton previously had a 17 year career with Baring Brothers, where he served as deputy chairman. Prior to that he worked at S.G.Warburg and qualified as a Solicitor with Lovell White & King.