Illinois Tool Works (NYSE: ITW), Glenview, IL, has agreed to sell its industrial packaging segment to The Carlyle Group (NASDAQ: CG) for $3.2 billion. The transaction is expected to close by mid-year.

Proceeds from the sale will be used to partially fund the company's plan to repurchase approximately 50 million shares by the end of 2014 in order to offset the EPS dilution associated with this divestiture. As of the end of 2013, the company had repurchased approximately 14 million shares in conjunction with this plan.

"We are pleased to announce the sale of the industrial packaging segment as this represents the last major step in refocusing our portfolio in conjunction with our enterprise strategy," said Scott Santi, ITW president and CEO.