Smurfit Kappa looks to ditch London as it plots merger with US rival West Rock

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The deal would see DS Smith shareholders receive a premium of 33 per cent from Mondi.
The deal would see DS Smith shareholders receive a premium of 33 per cent from Mondi.

Irish packaging giant Smurfit Kappa has confirmed it is in advanced discussions to merge with US rival West Rock, in a move which could create a paper and packaging powerhouse. 

The combined company would be named Smurfit Westrock and would be incorporated and domiciled in Ireland with its global headquarters in Dublin. It would also trade on the New York Stock exchange. 

In a statement, Smurfit Kappa said that the merger, which is subject to regulatory approval, would help create a “global leader” in sustainable packaging. 

Both companies have reached a combined revenue of £34bn (£27bn) in the last 12 months as demand for packaging supplies has shown signs of prevailing despite economic headwinds.

A tie-up between the firms would make Smurfit Kappa the latest firm to ditch its London listing this year, after a slew of companies have either scoped out dual listings or snubbed an IPO in the City this year.

Building supplier CRH is set to swap its London listing for New York this month after shareholders waived through the move earlier this year, while gambling giant Flutter is set for a dual listing. 

Similar warnings of have also come from fintech trading firm Plus500 and polling platform YouGov.

The London Stock Exchange has suffered a sharp drop off in fresh IPOs against a torrid backdrop for the IPO market.

Just 18 firms raised £650m in the first six months of the year as floats continued to be shelved amid volatility on the markets, according to data from EY.