DS Smith tumbles as Mondi abandons pursuit

DS Smith tanked on Friday after Mondi said it would not be making an offer for the rival packaging group, clearing the path for a takeover by International Paper.

Earlier this week, US firm International Paper agreed to buy DS Smith for $5.8bn in an all-share deal.

The news followed an agreement in principle last month for Mondi to buy DS Smith in a £5.1bn all-share deal.

"Following a period of due diligence, and after carefully considering the value the combination with DS Smith would deliver to Mondi's shareholders, the Mondi board has decided that the transaction would not be in the best interests of its shareholders," it said on Friday.

"Accordingly, Mondi does not intend to make an offer for DS Smith."

At 1215 BST, DS Smith shares were down 10.6% at 357.40p, while Mondi shares were 8.5% firmer at 1,493.05p.