Key Points
- International Paper’s $7.12 billion acquisition of DS Smith is set to gain EU approval. The approval hinges on asset divestitures to address competition concerns.
- The European Commission is expected to make a final decision by January 24.
- DS Smith provides packaging services to major clients like Amazon and Unilever.
- The deal strengthens International Paper’s European presence amid industry consolidation.
U.S.-based International Paper is poised to receive European Union regulatory approval for its $7.12 billion (£5.8 billion) acquisition of UK-based packaging company DS Smith. According to sources familiar with the matter, the approval comes after International Paper agreed to divest certain assets to address competition concerns.
The deal, announced in April last year, is expected to significantly enhance International Paper’s presence in the rapidly consolidating European paper and packaging industry. The European Commission, set to rule on the acquisition by January 24, has not commented on the ongoing review.
Sources did not disclose specific details regarding the assets to be sold as part of the agreement. However, divestitures of overlapping operations are a common requirement for mergers of this scale to alleviate antitrust concerns and maintain market competition.
DS Smith operates in over 30 countries and provides packaging, paper, and recycling services to major global companies such as Amazon (AMZN.O) and Unilever (ULVR.L). The acquisition will strengthen International Paper’s position in the European market by integrating DS Smith’s extensive operations and customer base.
This acquisition follows a trend of consolidation within the packaging industry. In 2024, Irish packaging giant Smurfit Kappa completed its $11 billion acquisition of U.S.-based WestRock, further illustrating the ongoing mergers and acquisitions within the sector.
Industry analysts suggest that International Paper’s European expansion will provide strategic benefits, including a broader product portfolio and enhanced supply chain efficiencies. However, regulatory scrutiny remains challenging, with authorities closely examining market impacts and competitive dynamics before approving such large-scale transactions.
