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Published: Saturday, 6/9/2007

Owens-Illinois firms up plan to sell plastics unit to London company

Owens-Illinois Inc. is in the final stages of negotiations with a London company to sell its business unit that produces prescription bottles and other plastic packaging.

Analysts said the pending sale of the plastics business to Rexam PLC would generate at least $1.5 billion to $1.8 billion for the metro Toledo company.

O-I announced in January that it was exploring the sale of the segment, which last year generated $770 million in annual sales.

George Staphos, an analyst with Banc of America Securities, said an announcement of the sale by the two companies could be made as early as Monday.

Rexam, a global consumer packaging company and a beverage can maker, owns the American National Can Co. in Whitehouse in southwestern Lucas County.

The sale of the plastics division is being viewed as a positive and financially sound move for the Perrysburg glass container maker.

It would give the Fortune 500 firm a chance to shed some of its massive debt and refocus on turning around its core glass business, Ghansham Panjabi, an analyst with Wachovia Securities, wrote in a report.

Kelley Yoder, an O-I spokesman, said the company wouldn't comment on the reports of the sale.

The unit in question makes plastic prescription bottles, tamperproof closures, and plastic medical devices. It has 18 factories around the world, including 13 in the United States as well as plants in Puerto Rico, Malaysia, Singapore, Hungary, and Brazil.

The sale would affect 220 workers at O-I's world headquarters and research operations in Perrysburg and 140 employees who make plastic lids at its Bowling Green factory.

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