SCA to sell its packaging business to DS Smith


Swedish paper group SCA is to sell its packaging operations to DS Smith for a total consideration of €1700 million on a debt-free basis. The transaction, which SCA hopes will enable growth in the hygiene paper business, does not cover two SCA kraftliner mills in Sweden, according to the company, which announced the plans on Tuesday.

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 the second-largest supplier of corrugated packaging in Europe behind Smurfit Kappa. The deal is scheduled for closure in the second quarter of 2012.

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