VENTURE capitalist John Moulton is splashing out £40m on parts of DS Smith’s stationery and office supplies business after the firm sold the rest to Spanish firm Unipapel.
Moulton’s Better Capital said its purchase of the UK and Irish business will go through once Unipapel buys up the other parts of DS Smith’s Spicers arm for around £200m.
The Spicers purchase is the latest in a string of investments by Better Capital, which has recently ploughed money into Reader’s Digest, collapsed housing repair firm Connaught and software firm Calyx.
DS Smith said it was offloading the firm so it could concentrate on its packaging business.
The firm reported 2011 sales of £2.47bn, of which £715.2m came in from the Spicers unit.
“Packaging will go from representing 80 per cent of our profits to 100 per cent. There will be quite a significant gain on disposal -- in excess of £60m”, said chief executive Miles Roberts.
Analysts welcomed the disposal yesterday. “Debt is not a problem for them [DS Smith] in any sense whatsoever, so it just gives them the opportunity of redeploying capital,” Oriel Securities’ Forsythe said. “It is definitely a good move. They’re clearly disposing off an asset they have signalled doesn’t provide anything to the rest of the group.”
Lazard advised DS Smith.
Lazard’s Richard Shaw led the team which advised DS Smith on its sale of Spicer to Unipapel.
He is an experienced mergers and acquisitions adviser who has worked on a number of prominent deals for Lazard, with industrials as his specialist area.
Before the DS Smith deal he worked on a £59m sale of Morse to 2e2 group, this time in the software sector.
He was also on the team which was responsible for a £3bn agreement in which Angel Trains was bought by a group led by Deutsche Bank and included AMP Capital.
In 2007 he saw through the sale of publicly listed Foseco to the Cookson Group for £592m, while he also worked on a deal in which Nippon Sheet glass bought well known UK company Pilkington.
Shaw is respected for his dealmaking and has been locked in major projects with Lazard, who are one of the world’s most prominent advisers.
Analysts at Evolution Securities suggested that Lazard had cut a good deal for DS Smith as a £150m price tag had been estimated.