DS Smith plc will sell its plastics division to U.S. private equity group Olympus Partners for $585 million in a deal expected to close in the second half of 2019.
The plastics division of DS Smith has flexible plastics, rigid plastics and foam products.
Gross assets for the plastics group as of Oct. 31 were £223 million ($293.6 million), while profit before tax was £28 million ($36.8 million).
London-based DS Smith will retain its paper packaging operations, including Europac, a Spanish maker of corrugated packaging the company purchased in January.
“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 fiber-based business,” CEO Miles Roberts said.
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, Conn. Its other holdings include protective packaging film maker Pregis.