America has been the graveyard of many an expansionist British company that was convinced the lessons learnt in its home market could be readily exported. So some nervousness might have been expected when DS Smith announced the purchase of a business serving East Coast states for the equivalent of £899 million including debt.
Instead the shares hit a new high, ending up 37¼p at 481½p. The acquisition of Interstate Resources has been structured so that it would seem to lessen the downside risks, even if this was not at DS Smith’s instigation.
It is being bought from the Frem family, who are so convinced of its prospects under its new owner that they are retaining a 20 per cent stake that can be bought out