Rexam shareholders in for higher-than-expected cash return

As promised, Rexam has outlined details of its cash return following the completion of its Personal Care unit disposal, with shareholders in for a higher-than-expected 395m-pound windfall.

The FTSE 100 consumer packaging giant had already pencilled in a cash return of around £370m.

The two-part disposal of its loss-making Personal Care division, proposed back in July, was completed last month for a total of $709m (£439m). The units sold were Cosmetics, Toiletries and Household care products and High Barrier Foods.

First-half statutory pre-tax profits at Rexam fell from £192m to £166m as Personal Care put a £171m dent in the bottom line.

The company has said that shareholders are to receive 45p per existing ordinary share, equating to an aggregate return of around £395m, by way of a B Share Scheme which is intended to provide a choice between cash either as capital or as income, or as a combination of the two.

Rexam said that existing ordinary shares will be consolidated so that shareholders get nine new ordinary share for every 10 existing ordinary shares held on the record date (January 25th).

This share capital consolidation is intended to help make the market price of the shares remain the same following the return of cash.