Germany's Gerresheimer loses interest in Rexam healthcare unit

* CEO tells paper Rexam (LSE: REX.L - news) unit not fulfilling criteria

* Rexam could fetch little under $1 bln

* Deal seen to close by year-end, early next year

FRANKFURT, Dec 4 (Reuters) - Germany's Gerresheimer AG (Other OTC: GRRMF - news) , a maker of medical supplies such as pill bottles and syringes, has lost interest in the healthcare packaging unit of Rexam Plc, the company said on Wednesday.

Sources told Reuters last month that Gerresheimer was competing with U.S. packaging companies Berry Plastics Group Inc and Silgan Holding Inc to buy Rexam's healthcare packaging unit in a deal expected to fetch a little less than $1 billion.

Private equity firms, including Bain Capital LLC and KKR (Frankfurt: A1C10P - news) & Co LP, also put in offers, the sources said.

A Gerresheimer spokesman confirmed a report in German newspaper Handelsblatt, which quoted the group's chief executive as saying that the Rexam unit did not fulfil Gerresheimer's acquisition criteria.

Rexam said in June it would sell its healthcare business, which makes medical packaging and drug delivery devices, such as bronchial inhalers and injection syringes, and accounts for about 10 percent of group sales.

Rexam expects to announce a deal by year-end or early next year, Chief Executive Officer Graham Chipchase told Reuters last month.

Gerresheimer early this year had withdrawn from the auction, but came back with an offer after Rexam signalled it would accept a lower valuation, according to two people familiar with the matter.