Linpac Group, the diversified supplier of paper and plastics-based packaging, returnable packaging systems and plastic automotive components bought by Montagu Private Equity in June last year, has sold its Linpac Containers Group unit to DS Smith for £170m. Montagu Private Equity bought Linpac Group for £860m.
DS Smith is funding the acquisition though existing debt and a new loan facility provided by Royal Bank of Scotland. The new debt created as a result of the acquisition costs will be reduced by using the proceeds of a fully underwritten rights issue, which was announced March 3, that is expected to raise £71m net of expenses.
Following the acquisition of Linpac Containers Group, DS Smith will be the UK leader in corrugated packaging. Cazenove is acting as underwriter and broker to DS Smith and UBS and Cazenove are joint sponsors. UBS is acting as financial adviser to DS Smith.