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.
https://www.hl.co.uk/shares/shares-sear ... dinary-10p
The above quote is from an item in the company news area of the above HL page for SMDS.
SMDS are up 7.25% as I type.
Ian (No holding).