The American paper giant, which is making a bid for one of Britain’s largest packaging companies, is considering a listing of its shares in London if the deal goes through.
In dramatic fashion, International Paper hijacked a proposed takeover of DS Smith by fellow FTSE 100 firm Mondi on Tuesday evening.
The US company offered to pay £5.7 billion for DS Smith, blowing out Mondi’s £5.1 billion bid.
Sources told the Mail last night that International Paper would consider a secondary listing on the London Stock Exchange, alongside the company’s main listing in New York.
The Americans are also considering transferring International Paper’s European operations into DS Smith, which would become a subsidiary led by the London-based company’s current management.
Takeover target: International Paper has dramatically hijacked a proposed takeover of DS Smith by fellow FTSE 100 firm Mondi
But if the deal goes through, it would still mean another British company falling into foreign hands.
DS Smith was founded in London in 1940 as a family box-making business.
It now employs more than 30,000 employees in 30 countries and has been listed in London since 1986.
The company makes products such as containers for cans and bottles, and food packaging.
Last month, Mondi offered to pay 373p per share for the company. Analysts said at the time that the proposal could leave the door open for a rival bid.
The US offer values DS Smith shares at 415p each. DS Smith said: ‘The board recognizes the strategic merits and potential for value creation through a combination with International Paper.
‘That is why the board is continuing discussions with International Paper.’
It said it was also continuing discussions with Mondi.
Tennessee-based International Paper has until April 23 to make a strong offer. The bidding war comes amid an exodus of companies from the London Stock Exchange.
US private equity giant KKR last week confirmed a £1.3 billion takeover of Glasgow-based Smart Metering Systems.
This month, bosses at British transport company Wincanton backed a £762 million bid from US logistics company GXO.
Last year, rival FTSE 100 paper and packaging company Smurfit Kappa announced an £11 billion mega merger with US giant Westrock.
Under the terms of the deal, which has yet to be completed, Smurfit will move its primary listing to New York, while retaining a secondary listing in London.
Earlier this year, investment bank Peel Hunt warned that the city is facing a ‘ruthless’ exodus of businesses.
“This is driven by low UK valuations, making it an attractive hunting ground for buyers,” analysts said.
