WestRock Stock On a Tear After Smurfit Kappa Deal
Merger To Create The World’s Largest Packaging Company By Revenue
Packaging company WestRock’s (WRK) shares soared by almost 7% in pre-market trading on Tuesday after a merger announcement with Dublin-based Smurfit Kappa to create the world’s largest listed paper and packaging company by revenue.
KEY TAKEAWAYS
- WestRock is merging with Dublin-based Smurfit Kappa to form largest listed paper and packaging company in the world in terms of revenue.
- In the last fiscal year, the companies combined earned $34 billion with adjusted core profit of $5.5 billion.
- Exceeding expectations, merger offers a 28% premium to WestRock’s closing price yesterday.
- WestRock’s share price soared by about 7% in pre-market trading on Tuesday.
Smurfit Kappa will own about 50.4% of the new company’s stock, and the remaining 49.6% will be owned by WestRock shareholders, Given the extensive synergies between the two companies, Smurfit Kappa expects the deal to increase profits in the high single-digit by over 20% by the end of its first year of operations. A new holding company will be created for Smurfit WestRock, which will be Dublin-based and listed on the New York Stock Exchange. The deal is expected to close in the second quarter of 2024 after regulatory approvals.
