In the mid-1990s, Rexam PLC was a cumbersome conglomerate with about 150 business units producing everything from corrugated boxes to diesel engines and telephone cards. Then, in 1996, Rolf Borjesson took the helm. The 61-year-old CEO thought the company had value but lacked focus. So he started selling. By the time he was done several years later, Borjesson had unloaded 100 units, leaving a core of consumer-packaging businesses.

Investors had their doubts at first, considering that Borjesson had reduced the size of the company by two-thirds. But he put the cash to work. In an effort to build up his new base, Borjesson made two key acquisitions. In 1999 he bought PLM, a Swedish maker of beverage cans, for $1.1 billion; the next year he bought American National Can Co. for $2.8 billion. The clincher came last fall, when he got Latasa, Brazil's leading canmaker. The move made Rexam the world's No. 1 producer of such cans, with a market share of 23%.

Borjesson defied his critics by picking the right companies at the right time. Indeed, since December, 1999, Rexam has seen underlying earnings per share soar at a compounded annual growth rate of 15.2%. How did he do it? Using "very proper due diligence," he says. Borjesson adds that he will buy a company only if he thinks he can make a 12% return in the first year. So far, his choices have paid off. The British company, which makes metal, glass, and plastics packaging for products such as beer, lipstick, and drugs, should see profits of $580 million in 2003, on sales of $5.6 billion, according to UBS. Rexam has 97 plants in more than 22 countries. And in the fall of 2002, it became a member of the FTSE 100, the leading index on the London exchange. "The market had a lot of doubt," concedes Borjesson, who is Swedish. "But the test of the pudding is to eat it, as they say over here."

Borjesson says his strategy worked in large part because the consumer-packaging industry tends to enjoy steady growth -- gross domestic product plus 1% to 2% a year. That will help keep Rexam a success story, in his view. Borjesson also believes that in years to come, Rexam will see rising demand in Eastern Europe, South America, and China. Shorter-term, Borjesson wants to make more acquisitions, particularly in the field of glass. He also is planning to raise prices, which will add to the company's bottom line. Finally, he hopes his cosmetics-packaging business -- which, he says, is always adding new products -- will add value.

Borjesson is so confident that a couple of years ago, he didn't balk at moving Rexam into a posh London building previously occupied by Enron. Was he superstitious at all? "I sleep very well," he says.

By Laura Cohn in London

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