SCA to divest packaging business to DS Smith
SCA is to sell its packaging operations to DS Smith for a total consideration of €1.7bn on a debt free basis. The two kraftliner mills in Sweden are not included in the transaction, SCA says. The company expects the transaction to enable growth in the hygiene business.
The SCA Packaging Group, excluding locations of certain joint ventures, runs facilities in 21 countries, including 109 corrugated manufacturing locations and four recycled containerboard mills. Last year, the company sold 3.6 million tonnes of recycled fibre, 1.4 million tonnes of corrugated case material and had corrugated sales volumes of 3.4 million square metres.
The transaction, which is subject to approval from DS Smith’s shareholders and EU antitrust clearance, would make DS Smith clearly the number two supplier of corrugated packaging in Europe behind Smurfit Kappa. The deal is scheduled for closure in the second quarter of 2012.