Rexam revival plans win City backing
Wednesday 11 September 1996
The shares rose 14p to 408.5p after Rolf Borjesson, the Swedish chief executive who replaced David Lyon in July, announced a programme of disposals aimed at businesses with sales of up to pounds 300m a year. "We need a flatter organisation to implement changes and increase our focus," he said.
Disposals in five of Rexam's seven sectors were expected in the next 12-18 months, he added, noting that businesses with annual turnover of pounds 200m had already been sold.
Analysts reckoned the disposals are likely to see Rexam concentrating on its core packaging activities at the expense of peripheral operations such as building and engineering.
"Whole divisions could be sold off," said Francesca Raleigh at brokers Panmure Gordon. "It's not difficult to make good money from packaging but there is a lot to do."
The news came as Rexam reported pre-tax profits in the six months to June of pounds 77m, down from pounds 112m a year ago, and warned that it was cautious about the outlook for the second half of the year despite a better July and August than the corresponding period in 1995.
Jeremy Lancaster, the new chairman, blamed "generally flat" industrial demand, particularly in the UK and Continental Europe.
Rexam has been out of favour with investors since it issued two warnings in three months last year as profits were hit by volatile raw material costs and customer de-stocking.
In July Rexam was ejected from the FT-SE 100 index.
- 1 Should Apple buy Greece?
- 2 Michael Douglas regrets 'embarrassing' Catherine Zeta-Jones with oral sex comments
- 3 Drummer Lee Rigby's family reject 'extremist' groups using Woolwich murder for political gain
- 4 Tunisia hotel attack: Locals form 'human shield' to protect hotel from gunman Seifeddine Rezgui
The moment a Queen's Guard soldier lost it and drew his gun at annoying tourist
Greece crisis: The wider lesson is that it’s time to abandon this failed experiment in currencies
'I wish the BBC would stop calling it Islamic State' – David Cameron unleashes frustration at broadcaster
Extend Right To Buy to tenants of private landlords, Labour's Jeremy Corbyn says
David Cameron struck double blow in his hopes to win Britain a new EU deal
Pentagon accuses Russia of 'playing with fire' over nuclear threats towards Nato
iJobs Money & Business
£22500 - £27000 per annum + OTE £45K: SThree: Since our inception in 1986, STh...
Negotiable: Recruitment Genius: This extremely successful and well-established...
Competitive with monthly bonus: Guru Careers: We are seeking an experienced FX...
Competitive (Freelance) : Guru Careers: An Investment Writer / Stock Picker is...