Ball Corporation prices Senior Notes to fund Rexam buyout

Ball Corporation BLL declared the pricing of an underwritten public offering of $1 billion of 4.375% Senior Notes, due 2020. The company has also priced $424.3 million (€400 million) of 3.50% Senior Notes, due 2020 and $742.5 million (€700 million) of 4.375% Senior Notes, due 2023. Depending on customary closing conditions, the offering is expected to close on Dec 14, 2015.

On Nov 30, Ball Corporation commenced the public offering of these dollar and euro denominated notes. Goldman, Sachs & Co.; Deutsche Bank Securities; BofA Merrill Lynch; KeyBanc Capital Markets; Mizuho Securities; and Rabobank will serve as joint book-running managers of the offering.

Ball Corporation will use the net proceeds from the offering, along with borrowings under its credit facilities and cash on hand, to fund the cash portion of the Rexam PLC REXMY takeover.

The beverage can maker had proposed to acquire Rexam in early 2015. The acquisition of Rexam for a cash and stock deal valued at $8.4 billion (£5.4 billion) will create the world's largest consumer packaging supplier.

London-based Rexam is a leading metal beverage can maker with 55 plants in more than 20 countries. The company produces cans for The Coca-Cola Company KO , Pepsico, Inc. PEP and Anheuser-Busch InBev SA. Upon completion of the transaction, Rexam shareholders will own about 19% of Ball Corporation's shares.

Ball Corporation is currently awaiting the regulatory clearances required to close the acquisition. Discussions with regulators are under way. Nonetheless, Ball Corporation expects to receive the necessary regulatory clearance for the deal by the first half of 2016.

The company expects to achieve net annual cost synergies in excess of $300 million in the third financial year of operations of the combined company, after the successful completion and integration of the buyout.