A US-based private equity firm is thought to be in talks to buy Irish paper and packaging group Jefferson Smurfit, according to sources close to the deal.
Madison Dearborn Partners has not been confirmed as the bidder, although Jefferson Smurfit has issued a statement confirming that it has received an approach from an interested party.
According to a report in the Financial Times, the approach is likely to prompt other potential bidders - including the International Paper Company and Mondi International, a unit of Anglo American - to come forward.
Jefferson Smurfit is the world's largest producer of container board, the paper used to make cardboard boxes, and it has itself been on the acquisition trail in recent years. One recent buy, a 29 per cent stake in the Stone Container Corporation, has pushed Jefferson Smurfit's share price down, in turn making Smurfit a less attractive acquisition.
Most analysts believe that Smurfit is only likely to attract a buyer provided that it sells its stake in Stone. According to the sources cited by the FT, the potential Madison Dearborn deal involves Smurfit spinning off Stone to its own shareholders, leaving the equity group free to bid solely for Jefferson shares.
The paper said that the deal is likely to be worth around $2.5 billion, plus the assumption $1.3 billion in Jefferson Smurfit debt.