Ethos Private Equity has entered into an agreement to acquire Nampak’s Tissue, Corrugated and Sacks divisions for a total purchase price of around $14m (R1.575bn).

The agreement excludes Nampak’s 50% shareholding in Sancella Proprietary.

Ethos said they are “excited about the growth potential of these three businesses, particularly under independent ownership, and intends to support them with the required investment, resources and leadership capacity needed to achieve their potential”.

The transaction is subject to a number of conditions precedent, including various de-merger and supply arrangements with Nampak and approval by the Competition authorities. 

The effective date of the transaction is expected to be in the second quarter of 2015.

On conclusion of the transaction, it is envisaged that the re-branded businesses will continue to be managed autonomously.

According to a statement from Nampak, the proceeds from the transaction would be used for its expansion plans in the rest of Africa.

Nampak CEO Andre de Ruyter said: "With the outlook for South African economic growth modest at best, Nampak is putting a strong emphasis on rigorous management of factors under its control.

"Already established as the packaging leader in Africa, with operations in 11 African countries beyond South Africa's borderscontributing more than a quarter of trading profit, we continue to focus on taking advantage of Africa's upward growth trajectory,” he said.