Shares in Smurfit Kappa (LON:SKG) have advanced this morning, building on their previous session’s gains, as the company reiterated its rejection of International Paper’s cash-and-share offer. The confirmation came after the Memphis-based group announced yesterday that it was offering €36.46 per share for the European packaging specialist.
As of 10:30 GMT, Smurfit Kappa’s share price had added 3.29 percent to 3,142.00p. The shares are outperforming the broader UK market, with the benchmark FTSE 100 index having reversed its earlier losses and currently standing 0.09 percent higher at 7,153.76 points. The group’s shares have added more than 42 percent to their value over the past year, as compared with about a 2.5-percent dip in the Footsie
Smurfit Kappa reiterates rejection
Smurfit Kappa announced in a statement this morning that it had noted International Paper’s announcement yesterday and was advising shareholders to take no action.
The company noted that its board had “already carefully considered, with its financial advisers, the Proposal in detail and has unanimously rejected it on the basis that it fails entirely to reflect the Group’s superior prospects as an independent business”. The group pointed out that the proposal represented “a valuation multiple significantly below recent comparable transactions”.
International Paper unveils offer
The rejection came after the US group announced yesterday that it had submitted a proposal to acquire the FTSE 100 group in a cash-and-share offer, valuing Smurfit Kappa at €36.46 per share. The Memphis-based company said that it had approached Smurfit Kappa on February 14.
International Paper noted that it remained ready to discuss the proposal with the FTSE 100 group’s board and shareholders and the reasons why it “believes it provides the best near and long-term value for Smurfit Kappa shareholders”.