We use cookies
To help provide you with a good experience on our website. By continuing to browse the website, you are agreeing to our use of cookies.

International Paper makes US$7B offer for DS Smith, sparking possible bidding war with Mondi


International Paper makes US$7B offer for DS Smith, sparking possible bidding war with Mondi

DS Smith confirmed yesterday it is in discussions with US rival International Paper (IP) for a possible all-share takeover worth a potential £5.72 billion (US$7.22 billion). IP’s bid would trump the acquisition agreement made this month with Mondi, who offered £5.14 billion (US$6.57 billion) for a merger. 

Source: PackagingInsights

While the Mondi merger was agreed upon in principle, no formal proceedings have begun, and DS Smith could choose to change course with a better offer on the table. If IP decides to make a formal offer, it will raise the likelihood of a bidding war with Mondi. 

In a statement, DS Smith’s board says that it “acknowledges the strategic merits and potential for value creation through a combination with International Paper” but that there is no certainty whether a formal offer will be made.

IP has a market capitalization of US$14.15 billion, making it larger (in valuation) than both DS Smith and Mondi.

Since the announcement, IP’s share price dropped 6.5%, while DS Smith’s rose 7.7%.

The packaging market has been undergoing a period of consolidation since Smurfit Kappa agreed to merge with WestRock in a tie-up worth an estimated US$34 billion last year.

Following that agreement, mergers and acquisitions have been on the rise. Notably, Graphic Packaging announced the sale of its Augusta, US, bleached paperboard manufacturing facility to Clearwater Paper for US$700 million.

Also, Constantia Flexibles signed an agreement to acquire approximately 57% of the shares of packaging producer Aluflexpack.

We will be updating our coverage of the story as it unfolds.

Relevant news

Chemical engineers in US, UK developing polystyrene recycling process
The team of engineers say their technique, which involves pyrolysis, could make recycling polystyrene both economically viable and energy efficient.
Circular economy technology provider circtec raises $163 million to build large-scale tire recycling plant
Circtec utilizes pyrolysis technology to recycle waste into renewable fuels and circular chemicals.
Siegwerk further expands its coatings portfolio
The new Packaging and Packaging Waste Regulation is clearly defining the future of packaging in the direction of a circular economy.
Decathlon invests in recycling start-up
DECATHLON Alliances invests in disruptive textile recycling startup RECYC’ELIT.
Altilium to open battery recycling facility in Teesside
UK-based Altilium has announced the latest advancements in its EcoCathode hydrometallurgical recycling technology.
SABIC signs MOU with Pashupati Group to target recycling opportunities in India
Memorandum of Understanding agreement with SABIC designed to explore, evaluate and develop local business opportunities for recycling of used plastic in India.