DS Smith has agreed to sell its plastics division to Olympus Partners for $585m, approximately £450m. The deal is expected to be completed over the second half of the year.
The plastics division of DS Smith comprises flexible plastics, rigid plastics and foam products. The company is described as the largest box maker in the UK.
Gross assets as of 31 October 2018 were £223m, while profit before tax was £28m.
The FTSE 100 packaging group bought Spanish rival Europac in January. The deal was intended to accelerate its deleveraging programme and bring more focus to the product range.
Speaking about the deal, Miles Roberts, group chief executive, said: “The transaction is attractive both financially and strategically for DS Smith as, together with the acquisition of Europac, we reinforce our position as a leader in sustainable packaging with a clear focus on our fibre-based business.”
DS Smith is a packaging supplier to Amazon. Despite strong recent trading, in 2018 the company warned that investment plans would be heavily scaled back due to uncertainty related to Brexit.
Olympus Partners is a private equity firm based in Stamford, Connecticut. Since 1988, the company has grown to have $8.5bn in committed capital.