The Lemon Fool

A bidding war was potentially on the cards on Tuesday as packaging company DS Smith - which recently agreed to be taken over by Mondi - confirmed it is in talks with New York-listed International Paper about a possible takeover offer.
Under the terms of the proposal, DS Smith shareholders would receive 0.1285 shares in International Paper for each of theirs, meaning they would own around 33.8% of the combined entity.

Based on International Paper's share price of $40.85 at the close on Monday, this represents 415p and a premium of 45% to the closing DS Smith share price on 7 February, which was the last day before the start of the offer period with Mondi.

"The board acknowledges the strategic merits and potential for value creation through a combination with International Paper," DS Smith said.

"Accordingly, the board is progressing its discussions with International Paper regarding the proposal."

It added that there can be certainty as to whether any offer will be made nor the terms of any such offer.

International Paper has until 23 April to either announce a firm intention to make an offer or walk away.

scottnsilky wrote:Thanks Ian for your post, is there a word missing from the second to last line of the quote? It doesn't look right to me as is.
I hold SMDS.

idpickering wrote:

scottnsilky wrote:Thanks Ian for your post, is there a word missing from the second to last line of the quote? It doesn't look right to me as is.
I hold SMDS.

You're welcome. I just checked, and the quote of the original is correct.

Ian.

torata wrote:
I think scottnsilky is right that there may be the word 'no' missing from the second to last line (in the original HL article)
It added that there can be no certainty as to whether any offer will be made nor the terms of any such offer.

torata

Arborbridge wrote:Hmm - if my shares go "Stateside" do I want to be bothered? I think that would force me to take the cash, which would quite likely be re-invested outside my HYP. Or perhaps another cruise!

Arb.

International Paper Company ("International Paper") is pleased to provide an update on its possible offer for DS Smith plc ("DS Smith"), pursuant to which International Paper would acquire the entire issued and to be issued share capital of DS Smith (the "Combination").

International Paper confirms that significant progress has been made in reciprocal due diligence as facilitated by the DS Smith Board and Management, and that it is now in a position to provide shareholders with more detail on the type and quantum of synergies it believes would arise from the Combination.

Corrugated packaging solutions is a core component of DS Smith's business. Due diligence has confirmed International Paper's belief that the Combination will significantly strengthen the combined packaging business and customer offerings - with packaging representing 84% of International Paper's current sales, approximately $1.5 billion (£1.2 billion1) of which is driven from European sales.

Commenting on the Combination, Mark Sutton, Chairman and CEO of International Paper, said: "Bringing International Paper together with DS Smith is a logical next step in International Paper's strategy to create value by strengthening our packaging businesses in North America and Europe. By combining the strengths of both companies, we believe we can enhance our offering of sustainable packaging solutions for customers in attractive and growing markets."

Arborbridge wrote:Hmm - if my shares go "Stateside" do I want to be bothered? I think that would force me to take the cash, which would quite likely be re-invested outside my HYP. Or perhaps another cruise!

Arb.

micrographia wrote:

Arborbridge wrote:Hmm - if my shares go "Stateside" do I want to be bothered? I think that would force me to take the cash, which would quite likely be re-invested outside my HYP. Or perhaps another cruise!

Arb.

If successful in their bid, International Paper have said they would seek a secondary London listing.

EEM

Arborbridge wrote: No easy excuse for selling, in that case.

MrFoolish wrote:What would happen if International Paper didn't have an LSE listing? I imagine most on-line brokers can cope with US listed shares?

MrFoolish wrote:What would happen if International Paper didn't have an LSE listing? I imagine most on-line brokers can cope with US listed shares?

The boards of International Paper Company ("International Paper") and DS Smith Plc ("DS Smith") are pleased to announce that they have reached agreement on the terms of a recommended all-share combination of International Paper with DS Smith.

Mondi plc ("Mondi") notes the terms of the recommended all-share combination of International Paper Company with DS Smith Plc ("DS Smith") announced on 16 April 2024.

Following a period of due diligence, and after carefully considering the value the combination with DS Smith would deliver to Mondi's shareholders, the Mondi Board has decided that the transaction would not be in the best interests of its shareholders. Accordingly, Mondi does not intend to make an offer for DS Smith.

Mondi's Board remains confident that its compelling portfolio of sustainable packaging and paper products, scale and cost advantaged quality asset base, along with its pipeline of organic investments, ensure it is well positioned to deliver long-term structural growth in the markets in which it operates, delivering strong cash generation, attractive returns and sustainable value accretive growth for shareholders.