International Paper Co. Merges with DS Smith in a Strategic $9.9 Billion All-Share Deal

Key Points

• International Paper Co. (IP) and DS Smith Plc have agreed on a $9.9 billion all-share merger.
• Post-merger, International Paper Co. (IP) shareholders will own 66.3%, and DS Smith shareholders will own 33.7%.
• The merger is expected to deliver $514 million in annual pre-tax cash synergies by the fourth year.

In this news

In a significant development in the paper and packaging industry, International Paper Co. (IP) has reached a definitive agreement to merge with DS Smith Plc in an all-share transaction valued at approximately $9.9 billion. Announced recently, this merger will see International Paper Co. (IP) issuing 0.1285 of its shares for each DS Smith share, effectively valuing each DS Smith share at 415 pence. Following the merger, International Paper Co. (IP) shareholders will own a majority stake of 66.3%, with DS Smith shareholders holding the remaining 33.7%. This strategic combination is projected to yield significant financial benefits, with anticipated pre-tax cash synergies of $514 million annually by the fourth year post-merger. The leadership structure post-merger will have Andrew Silvernail serving as the CEO of the combined entity, while Miles Roberts will continue to provide his expertise as a consultant. The completion of this deal is targeted for the fourth quarter of 2024, marking a significant milestone in the consolidation of the global paper and packaging sector. Analysts predict that this merger will not only streamline operations but also enhance competitive edges in a rapidly evolving market. The substantial synergies expected from this deal highlight the strategic intent to leverage combined strengths, optimizing operational efficiencies and expanding market reach. As the industry watches closely, the successful integration of these two giants could set a precedent for future mergers and acquisitions within the sector.