DS Smith is to invest £104m at its Kemsley mill in Kent to produce high-quality lightweight corrugated case material.
The move involves the acquisition from M-real of the New Thames Paper Mill on the neighbouring site as well as the 50% balance of Grovehurst Energy Limited, which supplies energy and services to both mills.
The deal is worth £60m, plus £7m in a one-off payment towards the costs of the transfer of the associated pension scheme to a third party. DS Smith intends to invest a further £37m in the modifications to New Thames Paper Mill to produce lightweight recycled CCM by January 2009.
A DS Smith spokesperson says the move will strengthen the long-term competitiveness of DS Smith’s important UK Paper and Corrugated Packaging by providing 260,000 tonnes of CCM for its own needs and that of its customers.
