Private equity firms Lone Star and Atlas Holdings are exploring bids for International Paper’s European packaging business, potentially replacing plans for a London stock market listing, according to Private Equity Wire.
The two firms are understood to be the remaining potential buyers for the business, previously known as DS Smith, with offers potentially valuing the division at less than $6bn, according to Private Equity Wire.
Remaining buyers and valuation parameters
International Paper confirmed it had received unsolicited approaches and was holding preliminary discussions with prospective buyers, according to Private Equity Wire.
International Paper said it continues to pursue its proposed separation and public listing in parallel, according to the same report.
The report said International Paper had planned to establish a separately listed European packaging group, incorporating DS Smith and International Paper assets, with listings in London and New York.
Links to DS Smith acquisition and proposed separation
The US packaging group acquired DS Smith in a transaction valued at £7.8bn including debt in 2024, according to Private Equity Wire.
International Paper announced plans in January to separate its European and North American operations, according to the report.
A sale at less than $6bn would represent a substantial reduction in valuation since the acquisition, reflecting pressure on packaging companies following a decline in demand and pricing from pandemic-era highs, according to Private Equity Wire.
International Paper recently recorded a goodwill impairment charge of nearly $2.5bn against its Europe, Middle East and Africa business, the report said.
Buyers and status of discussions
Lone Star manages approximately $96bn in committed capital, according to Private Equity Wire.
Atlas Holdings manages more than $16bn and has previously acquired UK businesses including banknote printer De La Rue, according to the same report.
International Paper said discussions remained at an early stage, with no certainty that a transaction would be completed, according to Private Equity Wire.
The report said the exploration of bids was cited as potentially replacing plans for a London stock market listing for the European packaging business.
