The companies are discussing the key terms of a possible combination to create Smurfit WestRock, according to a statement. WestRock shareholders could receive shares of the combined entity should a merger proceed, the statement said.
The deal would create a packaging giant that provides everything from corrugated storage boxes, to beer carriers to e-commerce shipping materials. The paper and packaging industry has been heavily consolidating for years, as market players seek scale to cut costs and better serve large customers.Following the completion of the potential deal, ordinary shares of Smurfit WestRock would be listed on the New York Stock Exchange.
Smurfit WestRock would be incorporated and domiciled in Ireland with global headquarters in Dublin, the statement said. Its North and South American operations would be based in Atlanta, Georgia. Due diligence is ongoing and definitive terms and conditions will be set out in a further announcement, the companies said, after The Wall Street Journal first reported on the merger talks. There’s still no certainty a transaction will definitely happen, they added.
Shares of Westrock have fallen about 9% this year, giving the firm a market value at about $8 billion. Smurfit is down 5.8% this year, valuing the company at €9.5 billion.