TOP NEWS: Smurfit Kappa Rejects International Paper Takeover Offer

6th Mar 2018 07:11

LONDON (Alliance News) - FTSE 100-listed packaging firm Smurfit Kappa Group PLC said Tuesday it has rejected an "unsolicited and highly opportunistic" takeover offer from International Paper Company.

International Paper, based in Memphis in the US, made an offer comprised of cash and a minority holding in an enlarged business.

Smurfit Kappa believes the offer does not reflect its worth nor its prospects going forward, and would involve its shareholders receive "a high proportion" of their consideration in International Paper shares.

The company did not provide any details surrounding the value of the takeover offer.

The Irish company posted "record" earnings before interest, tax, depreciation, and amortisation for 2017 of EUR1.24 billion, and with trading in 2018 so far positive, it said the offer "fails entirely" to reflect an "attractive" industry outlook.

Chairman Liam O'Mahony said: "The board of Smurfit Kappa has unanimously rejected this unsolicited and highly opportunistic proposal. It does not reflect the group's true intrinsic business worth or its prospects. We delivered a record performance in 2017 and underlying trading momentum has continued into 2018. The group has a proven management team which we believe will deliver significantly greater value for shareholders on a stand-alone basis."

He continued: "The board believes that it is in the best interests of all stakeholders for the group to pursue its future as an independent company, headquartered in Ireland, operating as the European and pan-American leader in paper-based packaging. We strongly advise shareholders to take no action."

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