Business Irish

Tuesday 11 December 2018

Smurfit was 'surprised' at Government silence on bid

CRITICAL: Tony Smurfit, CEO of Smurfit Kappa, at the IoD autumn lunch in Dublin. Photo: Jason Clarke.
CRITICAL: Tony Smurfit, CEO of Smurfit Kappa, at the IoD autumn lunch in Dublin. Photo: Jason Clarke.
John Mulligan

John Mulligan

Tony Smurfit, CEO of Irish packaging giant Smurfit Kappa, has rounded on the Government for failing to voice support for the global company as it was pursued in an acrimonious €9bn takeover attempt by Memphis-based International Paper this year.

The takeover approach by the US firm ultimately failed, but Mr Smurfit told an Institute of Directors lunch audience he was surprised, given the global scale of Smurfit Kappa and its contribution to the Irish economy, that no messages of support were received from Government.

Smurfit Kappa, with a market capitalisation of €8.3bn, paid €14m in corporation tax in Ireland last year on pre-tax profits of €576m, compared to €24m in corporation tax in 2016 on pre-tax profits of €654m. Its revenue last year was €8.5bn.

"We were often asked, especially in our European countries, was the Government going to help?" said Mr Smurfit of the takeover attempt.

"Of course, governments have no place in takeover activity. But I was a little surprised that, given the fact that Smurfit Kappa and its predecessor, Jefferson Smurfit, have been a significant economic and social contributor over decades, that we had no message at all of any support from any direction."

He added: "If we were subsumed into a US company, our benefit to the Irish economy would have significantly decreased."

Mr Smurfit also had a pop at media reporting of the takeover attempt, claiming there had been a "lack of balance".

Some shareholders agitated behind the scenes for acceptance of an offer.

"Maybe I should not be, but I was surprised at the lack of balance of certain media commentary," said Mr Smurfit. "The views of a couple of vocal shareholders, who are very short-term by their very charter, do not necessarily reflect the views of the vast majority."

Irish Independent

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