Rexam: no bid for Saint-Gobain bottle unit say analysts

Persistent speculation that Rexam is set to make a GBP 3 billion bid for Saint-Gobain“s bottle-making business is unfounded say analysts.
Rexam chief executive Lars Emilson has said that the packagi…

Persistent speculation that Rexam is set to make a GBP 3 billion bid for Saint-Gobain“s bottle-making business is unfounded say analysts. Rexam chief executive Lars Emilson has said that the packaging giant would not shy away from growing its glass business if it became available. The acquisition would make Rexam the world“s second largest bottle manufacturer behind Owens Illinois. However, analysts are not convinced that Rexam will make a bid. They point out that glass is not a strategic growth area for Rexam, and the acquisition of such a large business would redefine the company. In addition, Rexam has said it wants to expand in fast growing areas, and one analyst noted that this would rule out slow growing glass. Although Rexam has reserves for acquisitions, the deal would involve raising significant capital. Rexam has only recently spent GBP 150 million on a takeover of Precise Technology, the US packaging group. Analysts and investors welcomed Rexam“s move to expand into the global plastics packaging market and the company“s share price moved to an all time high.