Smurfit Kappa confirms merger with WestRock as London-listed share prices drop 11%
12 Sep 2023 --- Packaging giants Smurfit Kappa and WestRock have agreed to merge into what will be one of the world’s largest packaging corporations. Discussions were initially announced last Thursday, with the two rivals negotiating a potential US$20 billion tie-up.
Officially confirmed this morning, the companies will merge under the name Smurfit WestRock, run through a holding company in Ireland with global headquarters in Georgia, US.
Smurfit shareholders will own 50.4% of the combined company, and WestRock shareholders will own 49.6%.
Smurfit’s CEO, Anthony Smurfit, will hold the same position as the combined group after the merger.
WestRock shareholders will receive one new share and US$5 in cash for each of their existing shares, which the companies say will value WestRock at US$43.51 per share.
Smurfit Kappa shareholders will receive one new share for each ordinary Smurfit Kappa share.
Smurfit share prices plunged 11% at market open on the London Stock Exchange this morning after the deal was announced.
Commenting on the combination, Tony Smurfit, CEO of Smurfit Kappa, said: “This incredibly exciting coming together of our two great companies is a defining moment within the global packaging industry. Smurfit WestRock will be the ‘Go-To’ packaging partner of choice for customers, employees and shareholders. We will have the leading assets, a unique global footprint in both paper and corrugated, a superb consumer and specialty packaging business, significant synergies, and enhanced scale to deliver value in the short, medium and long term.”
Meanwhile, David Sewell, CEO of WestRock, said: “We look forward to working with Smurfit Kappa to build a leading global platform that harnesses the strength of WestRock’s consumer portfolio, presents a truly comprehensive offering of packaging solutions for customers and delivers meaningful value to our shareholders today and into the future. Smurfit Kappa shares our deep commitment to innovation across the packaging lifecycle, and we are confident that Smurfit WestRock will continue to lead the industry forward. I’m grateful to WestRock’s team members, whose hard work has made this combination possible, and excited for the many opportunities that will arise from becoming part of the partner of choice in our industry.”
By Louis Gore-Langton
