Friday 19 October 2018

Smurfit 'sad' at bid and won't sell shares

Michael Smurfit Photo: Steve Humphreys
Michael Smurfit Photo: Steve Humphreys

Ronald Quinlan and Fearghal O'Connor

Michael Smurfit would be "very sad" to see the family company he built into a global giant over decades disappear should International Paper's (IP) hostile takeover attempt for Smurfit Kappa succeed.

Smurfit, whose son Tony is CEO of Smurfit Kappa, told the Sunday Independent he would not sell his own shares for the €36.46 per share bid by the US giant that was rejected by the Irish company.

Asked for his view on the bid, he said: "Obviously it would be very sad to see the family company disappear in its entirety. That's what this would do if it was a successful takeover. I would be sad about that. But in saying that, you're a public company, and that's one of the risks you have [to deal with] in being a public company, that you're at the mercy of the market.

"I've been taking companies over all my life. I'm not surprised that IP decided to have a swing at us because we have been undervalued. The company's been growing at a tremendous pace, and that looks likely to continue for the next few years. It's a very opportunistic bid and they're just trying to take advantage of the future as the board set it out in the medium-term plan," he said.

Asked if he believed IP would ultimately prevail in its bid, he said: "It's a very low price. Smurfit shares are now trading at more or less the same price as the market gives to DS Smith without any premium. It's undervalued by about 15pc by the market. So no, the Smurfit board will reject it out of hand."

Asked if he had been in contact with his son in relation to the IP effort to acquire the company that was rejected out of hand last week, Smurfit said: "He's his own man. I'm out of the company over 10 years now. That's a pretty long time. It's a fast-moving industry. Things have changed. New regulations are in, all sorts of different things. But I certainly wouldn't be selling my shares at such a low price."

Sunday Indo Business

Business Newsletter

Read the leading stories from the world of Business.

Also in Business