Dubai International Capital LLC, the private equity unit of Dubai Holding, agreed to sell German packaging company Mauser to Clayton, Dubilier & Rice for about $1.7 billion in the emirate’s biggest asset sale since the debt crisis.

Mauser, acquired by DIC in 2007 in a deal valuing the company at about $1.1 billion, has consolidated revenue of more than $1.6 billion, DIC said in an e-mailed statement. The packager operates in 18 countries, up from 12 in 2007, DIC said.

“Mauser has been a very successful investment for DIC, providing a return of approximately double our equity invested,” Chief Executive Officer David Smoot said. “Now is the right time for it to continue its development under new ownership.”

The sale of Mauser to the New York-based private equity firm is the largest disposal by Dubai since it teetered on the brink of a default in 2009. The emirate is accelerating asset sales as it seeks to repay billions of dollars of debt accumulated by state-owned companies in a spending binge to make the city a trade and tourism hub.

Mauser was founded in a small town in the Black Forest in 1896 by Alfons Mauser, son of the inventor of the gun of the same name. The company builds packaging such as drums and cans for transporting chemicals and employs about 4,400 people.

DIC, owned by Dubai ruler Sheikh Mohammed Bin Rashid AlMaktoum’s Dubai Holding, bought Mauser from JPMorgan Chase & Co.’s One Equity Partners LLC.

DIC Asset Sales

DIC, which owns stakes in companies such as U.S. hedge fund Och-Ziff Capital Management Group LLC and German alumina products maker Almatis, reached an accord with creditors on restructuring $2.5 billion of liabilities in 2012.

The private equity firm sold its stake in Dubai retailer Rivoli Investments LLC to Swatch Group AG in November, while investment company Dubai Group LLC sold a 31 percent stake in Bank Islam in August for $550 million to BIMB Holdings.

Bank of America Merrill Lynch was the sole financial adviser to DIC for the Mauser sale. The sale and purchase agreement is conditional upon receipt of antitrust approvals, according to the statement.

Credit Suisse AG, Barclays Plc, BNP Paribas, ING Capital LLC, Natixis and Nomura Securities International, Inc. agreed to provide debt financing for the acquisition, CD&R said in a separate statement today. Credit Suisse was the financial adviser to CD&R on the acquisition, the buyout firm said.

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