Memphis-based International Paper, which has not yet tabled a firm offer for DS Smith, said it would keep the company’s existing headquarters in London after the deal.
“Key elements” of the functions at DS Smith’s London office would be maintained, subject to “consultation with impacted employees”, International Paper said, adding that it would also “seek a secondary listing of its shares on the London Stock Exchange”.
“I believe the combination of International Paper and DS Smith would create a winning position in renewable packaging and would be a strong catalyst to drive profitable growth and create value,” International Paper’s chief executive-elect, Andy Silvernail, said.
The firm reckons a tie-up could deliver at least $514m (£405m) of pre-tax cost savings on an annual basis.
Last month, the paper giant stirred up a potential bidding war over DS Smith with a takeover proposal that valued the UK firm at £5.72bn. The offer came after DS Smith had already waved through a bid from its London-listed rival Mondi several weeks prior.
International Paper has not launched a formal bid but has until April 23rd to make an offer.
“Significant progress has been made” in its due diligence for the deal, International Paper said.
Shares in DS Smith have rocketed some 33 per cent this year after the firm has fallen into the sights of buyers. After International Paper made it statement to the stock market, shares bounced nearly three per cent to their highest level since October 2021.
