London, England 02 August 2017 -- DS Smith has today announced that it has entered into a conditional agreement to acquire 80 per cent. of the shares of Interstate Management Resources, Inc. (Interstate) from Indevco.
Interstate is a family-owned integrated packaging and paper producer concentrated on the East Coast of the United States, operating from 19 production sites and having approximately 1,500 employees. Interstate operates across the entire packaging chain including wood procurement, paper manufacturing, design, packaging manufacturing and customer logistics.
DS Smith believes that the acquisition represents a compelling and attractive opportunity for DS Smith to expand its international fibre-based packaging footprint in the US market with a well-established, high quality and reputable independent group with an experienced management team. The acquisition also provides a clear opportunity for DS Smith to further differentiate itself with customers and provides security and cost benefits in relation to fibre and paper supply.
DS Smith plans to build upon Interstate's well-invested operational asset base, technology and distribution network in the Eastern United States to support Interstate's existing customers and DS Smith's multi-national customers, many of whom have operations in the US, enhance DS Smith's customer relationships, increase DS Smith's global brand exposure and provide a long term growth opportunity. DS Smith will draw upon its experience in previous integrations to realise the combined strength of Interstate and DS Smith.
Commenting on the acquisition, DS Smith's Group Chief Executive, Miles Roberts, said:
"We are delighted to announce the proposed acquisition of Interstate, a well-positioned and attractive entry point for us into the US market. We have seen significant customer pull for our innovative packaging solutions in the US and are excited by the opportunity to grow and support our customers' needs over this large and growing market. It is a further important step in our strategy, further building a higher quality, higher margin group with more growth potential. We very much look forward to working with all the employees, customers and suppliers of Interstate."
The acquisition is conditional on, inter alia, DS Smith shareholder and anti-trust approvals and is expected to complete in the third quarter of 2017.