New acquisition by Rexam packaging to provide a leading position in Egypt, North Africa and expansion opportunities for the growing beverage markets in the Middle East.

Rexam PLC, the global consumer packaging company and the world’s leading beverage can maker, announces that it has agreed to acquire all the shares in Ecanco, the Egypt-based beverage can maker, from a group of private shareholders for a cash consideration of US$107m (£61m) including borrowings assumed.

The acquisition, which is subject to the approval of the Cairo and Alexandria Stock Exchange, will be earnings enhancing from the outset and is expected to meet Rexam’s cost of capital from 2007. It is anticipated that the transaction will complete shortly.

Ecanco is the sole beverage can maker in Egypt. Its plant, located just outside Cairo, comprises a single line for steel beverage cans. Most of its cans are sold locally, with the balance exported to North Africa and the Middle East. The company’s major customers are Pepsi and Coca-Cola.

For the financial year 2005, it is estimated that Ecanco had sales of US$41m (£23m) and, at 31 December 2005, net operating assets of US$27m (£15m).

Lars Emilson, Rexam’s Chief Executive, said: "Our strong presence in countries such as Brazil, China, Russia and now Egypt, means that emerging markets account for around 20% of our turnover. Ecanco gives us a leading position in Egypt and North Africa and provides a base to develop these as well as other growing markets in the Middle East. We also see potential for increasing efficiencies and for synergies in the supply chain."

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