LONDON (From news reports) -- Britain's competition watchdog said it was investigating whether U.S.-based Liqui-Box's $585 million takeover of a DS Smith Plc business could lessen competition in the market.
UK-based DS Smith in March agreed to sell its plastics division to Liqui-Box, a portfolio company of private equity firm Olympus Partners.
The sale, if completed, would mark an end to the company's foray into plastics and would allow it to focus on recyclable packaging materials and corrugated products, DS Smith said in March.
Liqui-Box's planned takeover of DS Smith's unit adds to a long list of M&A in the packaging sector, which private equity firms have been focusing on for its stable cashflow and demand from online shopping.
Commenting on the Competition and Markets Authority's (CMA)investigation, a spokesman for DS Smith said it continues to expect completion of the deal to take place in the second half of the year.
Liqui-Box did not respond to Reuters' request for a comment.
Liqui-Box, founded in 1961, manufactures bag-in-box packaging and pouches to serve industries including dairy, beverage, food and non-food markets.
A couple of months back, Europe's biggest plastic packaging group RPC Group agreed to a buyout offer from plastics maker Berry Global Group Inc that valued the company at 3.34 billion pounds ($4.37 billion).