Mondi Weighs Deal for $7 Billion Packaging Rival DS Smith
February 25, 2021
VIENNA (From news reports) -- Mondi Plc, the packaging and paper group, is exploring a potential takeover of British rival DS Smith Plc, according to people familiar with the matter.
Mondi has been speaking with advisers as it considers the merits of a possible transaction, the people said, asking not to be identified because the discussions are private. DS Smith shares rose as much as 14% in London trading, boosting its market value to more than 5.7 billion pounds ($8.1 billion).
A deal between the two companies would be one of the largest announced in the U.K. so far this year. Deliberations are at an early stage, and there's no certainty they will lead to a transaction, the people said.
Representatives for Mondi and DS Smith declined to comment.
While a pandemic-fueled boom in online shopping has provided a demand boost for packaging companies, it has also led to piles of used cardboard that can't be picked up and recycled quickly enough. That has pushed up costs for companies including DS Smith, which rely on recycled containerboard to make their boxes.
