INTERNATIONAL Paper is poised to take over packaging giant DS Smith in a £5.8 billion deal after the boards of the two firms announced they had reached agreement on the terms of a recommended all-share combination.
Upon completion of the combination, DS Smith shareholders will own approximately one third, while International Paper shareholders will own approximately two-thirds. International Paper will also seek a secondary listing of its shares on the London Stock Exchange.
The two businesses believe there is a ‘compelling’ strategic and financial rationale for the combination as it would be expected to create a global leader in sustainable packaging solutions; strengthen customer value proposition through enhanced offerings, innovation and geographic reach; and combine the expertise of two experienced management teams to accelerate innovative solutions and products.
Mark S. Sutton, chairman and CEO of International Paper, said, “Combining with DS Smith is a logical next step in International Paper’s strategy to drive profitable growth by strengthening our global packaging business. DS Smith is a leader in packaging solutions with an extensive reach across Europe, which complements International Paper’s capabilities and will accelerate growth through innovation and sustainability. We are confident this combination will drive significant value for our employees, customers, and shareholders.”
Geoff Drabble, chair of DS Smith, added, “The board believes the combination with International Paper represents attractive value and creates a strong investment proposition for DS Smith shareholders in the global sustainable packaging industry.”
