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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities
Exchange Act of 1934
Date of Report (Date of earliest event reported):
September 6, 2023
WestRock Company
(Exact name of registrant as specified in its
charter)
| Delaware |
001-38736 |
37-1880617 |
|
(State or other jurisdiction of
incorporation) |
(Commission File Number) |
(IRS Employer
Identification Number) |
| 1000 Abernathy Road, Atlanta, Georgia |
30328 |
| (Address of principal executive offices) |
(Zip Code) |
Registrant’s telephone number, including area
code: (770) 448-2193
Not Applicable
(Former name or former address, if changed since last
report)
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
|
Title of each class |
|
Trading
Symbol(s) |
|
Name of each exchange
on which registered |
| Common Stock, $0.01 par value, per share |
|
WRK |
|
New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities
Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant
has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant
to Section 13(a) of the Exchange Act. ☐
| Item 7.01. | Regulation FD Disclosure. |
On September 6, 2023, Smurfit Kappa Group (“Smurfit Kappa”)
(LSE:SKG; ISE:SKG), a FTSE 100 company, disclosed that the boards of directors of Smurfit Kappa and WestRock Company (the “Company”)
are discussing the key terms of a potential combination to create Smurfit WestRock, a global leader in sustainable packaging (the “Potential
Combination”).
The Potential Combination would be expected to involve the creation
of a new holding company, Smurfit WestRock (“Smurfit WestRock”). Smurfit WestRock would be incorporated and domiciled in Ireland
with global headquarters in Dublin, Ireland and North and South American operations headquartered in Atlanta, Georgia. The Potential Combination
would be effected through an Irish scheme of arrangement involving Smurfit Kappa and a merger of a subsidiary with the Company. Any such
combination would result in the Company’s shareholders receiving consideration consisting primarily of shares of Smurfit WestRock.
A copy of Smurfit Kappa’s press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. The Company
confirms the existence of these discussions.
The information provided pursuant to this Item 7.01, including Exhibit
99.1 in Item 9.01, is “furnished” and shall not be deemed to be “filed” with the SEC or incorporated by reference
in any filing under the Exchange Act or the Securities Act, except as shall be expressly set forth by specific reference in any such filings.
No Offer or Solicitation
This communication does not constitute an offer to sell or the solicitation
of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction
in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such
jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities
Act of 1933, as amended.
Important Information for Investors and Stockholders
If the proposed combination occurs as described
in this communication, Smurfit WestRock would expect to file a registration statement with the Securities and Exchange Commission (“SEC”)
containing a preliminary prospectus of Smurfit WestRock that would also constitute a preliminary proxy statement of the Company. Each
of Smurfit Kappa, the Company and Smurfit WestRock would also file other relevant documents in connection with the proposed combination.
This communication is not a substitute for a proxy statement/prospectus or registration statement or for any other document that Smurfit
WestRock , Smurfit Kappa or the Company may file with the SEC and send to stockholders in connection with the potential transaction.
BEFORE MAKING ANY VOTING OR INVESTMENT DECISIONS, INVESTORS AND SECURITY HOLDERS OF SMURFIT KAPPA AND THE COMPANY ARE URGED TO READ THE
PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT SMURFIT KAPPA, THE COMPANY, SMURFIT WESTROCK , THE PROPOSED TRANSACTION AND RELATED MATTERS.
Investors and security holders will be able to obtain free copies of the proxy statement/prospectus (when available) and other documents
filed with the SEC by Smurfit WestRock and the Company through the website maintained by the SEC at http://www.sec.gov.
Participants in
the Solicitation
This communication
is not a solicitation of proxies in connection with the proposed combination. The Company and Smurfit Kappa and certain of their respective
directors, certain of their respective executive officers and other members of management and employees may be considered participants
in the solicitation of proxies with respect to the potential transaction under the rules of the SEC. Information about the Company’s
directors and executive officers is set forth in its Annual Report on Form 10-K for the year ended September 30, 2022, which was
filed with the SEC on November 18, 2022, and its proxy statement for its 2023 annual meeting of stockholders, which was filed with the
SEC on December 15, 2022, available at ir.westrock.com/ir-home/ and www.sec.gov. Information about Smurfit Kappa’s directors and
executive officers may be found in its 2022 Annual Report filed with applicable securities
regulators in the United Kingdom on March 28,
2023, available on its website at www.smurfitkappa.com/investors. The information included on, or accessible through, the Company’s
or Smurfit Kappa’s website is not incorporated by reference into this communication. These documents can be obtained free of charge
from the sources indicated above. Additional information regarding the interests of such participants in the solicitation of proxies in
respect of the potential transaction will be included in the registration statement and proxy statement/prospectus and other relevant
materials to be filed with the SEC if and when they become available.
Cautionary Statement Regarding Forward-Looking Information
This communication contains forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements generally include
statements regarding the potential transaction between the Company and Smurfit Kappa, including any statements regarding the potential
transaction and the listing of Smurfit WestRock , the rationale and expected benefits of the potential transaction (including, but not
limited to, cost synergies), and any other statements regarding the Company’s and Smurfit Kappa’s future expectations, beliefs,
plans, objectives, results of operations, financial condition and cash flows, or future events or performance. These statements are often,
but not always, made through the use of words or phrases such as “anticipates,” “expects,” “intends,”
“plans,” “targets,” “forecasts,” “projects,” “believes,” “seeks,”
“schedules,” “estimates,” “positions,” “pursues,” “may,” “could,”
“should,” “will,” “budgets,” “outlook,” “trends,” “guidance,”
“focus,” “on schedule,” “on track,” “is slated,” “goals,” “objectives,”
“strategies,” “opportunities,” “poised,” “potential” and similar expressions. All such
forward-looking statements are based on current expectations of the Company’s and Smurfit Kappa’s management and therefore
involve estimates and assumptions that are subject to risks, uncertainties and other factors that could cause actual results to differ
materially from the results expressed in the statements. Key factors that could cause actual results to differ materially from those projected
in the forward-looking statements include a condition to the closing of the potential combination may not be satisfied; the occurrence
of any event that can give rise to termination of the potential combination; a regulatory approval that may be required for the potential
combination is delayed, is not obtained in a timely manner or at all or is obtained subject to conditions that are not anticipated; Smurfit
WestRock is unable to achieve the synergies and value creation contemplated by the potential transaction; Smurfit Kappa is unable to promptly
and effectively integrate the Company’s businesses; management’s time and attention is diverted on transaction related issues;
disruption from the potential combination makes it more difficult to maintain business, contractual and operational relationships; the
credit ratings of Smurfit Kappa decline following the potential transaction; legal proceedings are instituted against Smurfit Kappa or
the Company; the Company or Smurfit Kappa are unable to retain or hire key personnel; the announcement or the consummation of the potential
combination has a negative effect on the market price of the capital stock of the Company or Smurfit Kappa or on the Company’s or
Smurfit Kappa’s operating results; evolving legal, regulatory and tax regimes; changes in economic, financial, political and regulatory
conditions, in Ireland, the United Kingdom, the United States and elsewhere, and other factors that contribute to uncertainty and volatility,
natural and man-made disasters, civil unrest, pandemics (e.g., the coronavirus (COVID-19) pandemic (the “COVID-19 pandemic”)),
geopolitical uncertainty, and conditions that may result from legislative, regulatory, trade and policy changes associated with the current
or subsequent Irish, U.S. or U.K. administration; the ability of the Company or Smurfit Kappa to successfully recover from a disaster
or other business continuity problem due to a hurricane, flood, earthquake, terrorist attack, war, pandemic, security breach, cyber-attack,
power loss, telecommunications failure or other natural or man-made event, including the ability to function remotely during long-term
disruptions such as the COVID-19 pandemic; the impact of public health crises, such as pandemics (including the COVID- 19 pandemic) and
epidemics and any related company or governmental policies and actions to protect the health and safety of individuals or governmental
policies or actions to maintain the functioning of national or global economies and markets; actions by third parties, including government
agencies; the risk that disruptions from the potential transaction will harm the Company’s or Smurfit Kappa’s business, including
current plans and operations; certain restrictions during the pendency of the potential combination that may impact the Company’s
or Smurfit Kappa’s ability to pursue certain business opportunities or strategic transactions; the Company’s or Smurfit Kappa’s
ability to meet expectations regarding the accounting and tax treatments of the potential transaction; the risks and uncertainties discussed
in “Risk Factors” and “Information Regarding Forward-Looking Statements” sections in the Company’s reports
filed with the SEC the “Risks and Uncertainties” section in Smurfit Kappa’s reports available on the National Storage
Mechanism at https://data.fca.org.uk/#/nsm/nationalstoragemechanism and on its website at https://www.smurfitkappa.com; and the risks
and uncertainties discussed in. These risks, as well as other risks associated with the potential transaction, will be more fully discussed
in the proxy statement/prospectus, the shareholder circular, the U.K. listing prospectus
and the other relevant materials filed with the
SEC and applicable securities regulators in the United Kingdom. While the list of factors presented here is, and the list of factors to
be presented in proxy statement/prospectus and shareholder proxy circular will be, considered representative, no such list should be considered
to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to
the realization of forward-looking statements. We caution you not to place undue reliance on any of these forward-looking statements as
they are not guarantees of future performance or outcomes and that actual performance and outcomes, including, without limitation, our
actual results of operations, financial condition and liquidity, and the development of new markets or market segments in which we operate,
may differ materially from those made in or suggested by the forward-looking statements contained in this communication. Except as required
by law, neither Smurfit Kappa nor the Company assumes any obligation to update or revise the information contained herein, which speaks
only as of the date hereof.
(d) Exhibits
| ITEM 9.01. | Financial Statements and Exhibits |
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| |
WESTROCK COMPANY |
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| |
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|
| |
|
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By: |
/s/Alexander W. Pease |
|
| |
Name: |
Alexander W. Pease |
|
| |
Title: |
Executive Vice President and Chief Financial Officer |
|
Date: September 7, 2023
EXHIBIT 99.1
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION,
IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT
LAWS OR REGULATIONS OF SUCH JURISDICTION.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
Smurfit Kappa and WestRock in discussions regarding key terms
of Potential Combination
7 September 2023
Smurfit Kappa Group (“Smurfit Kappa”)
(LSE:SKG; ISE:SKG), a FTSE 100 company, confirms that the boards of directors (the “Boards”) of Smurfit Kappa and WestRock
Company (“WestRock”) (NYSE:WRK), a S&P 500 company, are discussing the key terms of a potential combination to create
Smurfit WestRock, a global leader in sustainable packaging (the “Potential Combination”).
The Potential Combination would be expected
to involve the creation of a new holding company, Smurfit WestRock (the “Combined Group”). Smurfit WestRock would be incorporated
and domiciled in Ireland with global headquarters in Dublin, Ireland and North and South American operations headquartered in Atlanta,
Georgia. The Potential Combination would be effected through an Irish scheme of arrangement involving Smurfit Kappa and a merger of a
subsidiary with WestRock.
Any such combination would result in WestRock
shareholders receiving consideration consisting primarily of shares of the Combined Group.
Strategic and Operational Rationale
The Boards of Smurfit Kappa and WestRock believe
the Potential Combination will create the global “Go-To” packaging partner of choice:
| § | Combining two highly complementary
portfolios to create a global leader in sustainable packaging |
| § | Unparalleled geographic reach
across 42 countries with a significant presence across both Europe and the Americas |
| § | Complementary portfolios with
unique product diversity and innovative sustainability capabilities, with breadth and depth across renewable, recyclable and biodegradable
packaging solutions |
| § | Culturally
aligned with strong customer focus |
| § | Broader
opportunities for approximately 100,000 employees |
| § | Improved operating efficiency
and increased returns across over 500 converting operations and 67 mills |
| § | Shared
sustainability ambitions for a sustainable future |
| § | Experienced management teams
with strong track records of execution and delivery to support global operations |
| § | Immediate
and long-term value creation opportunity for both sets of shareholders |
Financial Rationale
The Boards of Smurfit Kappa and WestRock believe
the Potential Combination represents a unique opportunity to create value:
| § | Combined last twelve months’
revenue and adjusted EBITDA as of 30 June 2023 of approximately $34 billion and $5.5 billion1, respectively |
| § | Strong
cash flows for future growth and capital returns |
| § | Targeting annual pre-tax run-rate
cost synergies in excess of $400 million at the end of the first full year following completion; delivery of synergies expected to require
estimated one-off cash costs of approximately $235 million to be incurred |
| § | Expected to deliver compelling
benefits to Smurfit WestRock shareholders, with transaction structure providing the opportunity for both sets of shareholders to participate
meaningfully in Smurfit WestRock’s significant upside value potential |
| § | Disciplined capital allocation
expected to deliver improved operating efficiency and increased returns |
| § | Committed
to strong investment grade credit rating |
Further Details on the Potential Combination
| § | Following
completion of the Potential Combination: |
| o | Smurfit WestRock’s ordinary
shares would be listed on the New York Stock Exchange (NYSE) and the Combined Group would seek U.S. equity index inclusion as soon as
possible thereafter. |
| o | Smurfit Kappa’s premium
listing on the London Stock Exchange (LSE) is expected to be cancelled and the Combined Group is expected to list on the standard listing
segment. |
| o | Smurfit Kappa would de-list from
Euronext Dublin. |
| o | The Combined Group would be incorporated
and domiciled in Ireland with global headquarters in Dublin, Ireland and North and South American operations headquartered in Atlanta,
Georgia. |
| § | Discussions between the parties
remain ongoing regarding the Potential Combination. Smurfit Kappa and WestRock are engaged in a mutual due diligence process. The definitive
terms and conditions of any transaction will be set out in a further announcement. |
| § | Any Potential Combination would
be conditional, inter alia, upon the approval by shareholders of Smurfit Kappa and WestRock and receipt of required regulatory clearances
as well as other customary conditions. |
| § | There can be no certainty that
the Potential Combination or any other transaction between the parties will be agreed or will occur. |
| § | This
announcement has been made with the consent of WestRock. |
Further announcements may be made as and when appropriate.
This announcement contains Inside Information
for the purposes of Regulation (EU) No 596/2014 on Market Abuse (as onshored into UK law by the European Union (Withdrawal) Act 2018 and
the Market Abuse Exit Regulations 2019). The person responsible for arranging for the release of this announcement on behalf of Smurfit
Kappa is Gillian Carson-Callan, Company Secretary. The date and time of this announcement is the same as the date and time that it has
been communicated to the media, at 2 am on 7 September 2023.
1 Please refer to notes and sources of information and
bases of calculation for further information.
About Smurfit Kappa
Smurfit Kappa, a FTSE 100 company, is one of
the leading providers of paper-based packaging solutions in the world, with more than 47,000 employees in over 350 production sites across
36 countries and with revenue of €12.8 billion in 2022. We are located in 22 countries in Europe, 13 in the Americas and one in
Africa. We are the only large-scale pan-regional player in Latin America. Our products, which are 100% renewable and produced sustainably,
improve the environmental footprint of our customers.
With our proactive team, we relentlessly use
our extensive experience and expertise, supported by our scale, to open up opportunities for our customers. We collaborate with forward-thinking
customers by sharing superior product knowledge, market understanding and insights in packaging trends to ensure business success in their
markets. We have an unrivalled portfolio of paper-based packaging solutions, which is constantly updated with our market-leading innovations.
This is enhanced through the benefits of our
integration, with optimal paper design, logistics, timeliness of service, and our packaging plants sourcing most of their raw materials
from our own paper mills.
We have a proud tradition of supporting social,
environmental and community initiatives in the countries where we operate. Through these projects we support the UN Sustainable Development
Goals, focusing on where we believe we have the greatest impact.
Follow us on LinkedIn,
Twitter, Facebook, YouTube.
smurfitkappa.com
About WestRock
WestRock partners with customers to provide
differentiated, sustainable paper and packaging solutions that help them win in the marketplace. WestRock’s team members support
customers around the world from locations spanning North America, South America, Europe, Asia and Australia. Learn more at www.westrock.com.
Enquiries:
Smurfit Kappa
Ciarán Potts
Head of Investor Relations
T: +353 1 202 7127
E :ir@smurfitkappa.com
Important Additional Information
Neither this announcement nor any copy of it
may be taken or transmitted directly or indirectly into or from any jurisdiction where to do so would constitute a violation of the relevant
laws or regulations of such jurisdiction. Any failure to comply with this restriction may constitute a violation of such laws or regulations.
Persons into whose possession this announcement or other information referred to herein should inform themselves about, and observe, any
restrictions in such laws or regulations.
This announcement has been prepared for the
purpose of complying with the applicable law and regulation of the United Kingdom, the United States and Ireland and information disclosed
may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws and regulations
of jurisdictions outside the United Kingdom, the United States or Ireland.
Additional Information about the Potential Combination and Where
to Find It
In connection with the Potential Combination
between Smurfit Kappa and WestRock, Smurfit Westrock, the combined company (“SW”) would file with the U.S. Securities
and Exchange Commission
(the “SEC”) a registration statement,
which would include a proxy statement of WestRock that would also constitute a prospectus of SW (the “proxy statement/prospectus”).
Each of Smurfit Kappa, WestRock and SW would also file other relevant documents in connection with the Potential Combination. The definitive
proxy statement/prospectus would be sent to the shareholders of WestRock. Smurfit Kappa would also publish a shareholder circular approved
by the UK Financial Conduct Authority (the “FCA”), which would be sent to Smurfit Kappa’s shareholders or otherwise
made available in accordance with Smurfit Kappa’s articles of association and the UK Listing Rules. SW would publish a prospectus
approved by the FCA, which would be made available in accordance with Rule 3.2 of the UK Prospectus Regulation Rules (the “UK listing
prospectus”). This communication is not a substitute for any registration statement, proxy statement/prospectus, UK listing prospectus
or other document Smurfit Kappa, WestRock and/or SW may file with the SEC or applicable securities regulators in the United Kingdom and
Ireland in connection with the Potential Combination. BEFORE MAKING ANY VOTING OR INVESTMENT DECISIONS, INVESTORS, STOCKHOLDERS AND SHAREHOLDERS
OF SMURFIT KAPPA AND WESTROCK ARE URGED TO READ CAREFULLY AND IN THEIR ENTIRETY THE REGISTRATION STATEMENT, THE PROXY STATEMENT/PROSPECTUS,
THE SHAREHOLDER CIRCULAR AND THE UK LISTING PROSPECTUS, AS APPLICABLE, AND ANY OTHER RELEVANT DOCUMENTS THAT WOULD BE FILED WITH THE SEC
OR APPLICABLE SECURITIES REGULATORS IN THE UNITED KINGDOM AND IRELAND, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, IN
CONNECTION WITH THE POTENTIAL COMBINATION WHEN THEY BECOME AVAILABLE, AS THEY WOULD CONTAIN IMPORTANT INFORMATION ABOUT SMURFIT KAPPA,
WESTROCK, SW, THE POTENTIAL COMBINATION AND RELATED MATTERS. The registration statement and proxy statement/prospectus and other documents
filed by Smurfit Kappa, WestRock and SW with the SEC, when filed, would be available free of charge at the SEC’s website at www.sec.gov.
In addition, investors and shareholders would be able to obtain free copies of the proxy statement/prospectus and other documents filed
with the SEC by WestRock online at ir.westrock.com/ir-home/, upon written request delivered to 1000 Abernathy Road, Atlanta, Georgia or
by calling (770) 448-2193, and would be able to obtain free copies of the registration statement, proxy statement/prospectus, shareholder
circular, UK listing prospectus and other documents which would be filed with the SEC and applicable securities regulators in the United
Kingdom and Ireland by SW or Smurfit Kappa online at www.smurfitkappa.com/investors, upon written request delivered to Beech Hill, Clonskeagh,
Dublin 4, Ireland or by calling +353 1 202 7127. The information included on, or accessible through, Smurfit Kappa’s or WestRock’s
website is not incorporated by reference into this communication.
This communication is for informational purposes
only and is not intended to, and shall not, constitute an offer to sell or buy or the solicitation of an offer to sell or buy any securities,
nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to appropriate
registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means
of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.
Participants in the Solicitation of Proxies
This communication is not a solicitation of
proxies in connection with the Potential Combination. However, under SEC rules, Smurfit Kappa, WestRock, SW, and certain of their respective
directors, executive officers and other members of the management and employees may be deemed to be participants in the solicitation of
proxies in connection with the Potential Combination. Information about WestRock’s directors and executive officers may be found
in its 2022 Annual Report on Form 10-K filed with the SEC on November 18, 2022, available at ir.westrock.com/ir-home/ and www.sec.gov.
Information about Smurfit Kappa’s directors and executive officers may be found in its 2022 Annual Report filed with applicable
securities regulators in the United Kingdom on March 28, 2023, available on
its website at www.smurfitkappa.com/investors.
These documents can be obtained free of charge from the sources indicated above. Additional information regarding the interests of such
potential participants in the solicitation of proxies in connection with the Potential Combination will be included in the proxy statement/prospectus
and other relevant materials filed with the SEC when they become available.
Information Regarding Forward-Looking Statements
This communication contains forward-looking
statements as that term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Forward-looking statements can sometimes be identified
by the use of forward-looking terms such as “believes,” “expects,” “may,” “will,” “shall,”
“should,” “would,” “could,” “potential,” “seeks,” “aims,” “projects,”
“predicts,” “is optimistic,” “intends,” “plans,” “estimates,” “targets,”
“anticipates,” “continues” or other comparable terms or negatives of these terms or other variations or comparable
terminology or by discussions of strategy, plans, objectives, goals, future events or intentions, but not all forward-looking statements
include such identifying words.
Forward-looking statements are based upon current
plans, estimates and expectations that are subject to risks, uncertainties and assumptions. Should one or more of these risks or uncertainties
materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated
by such forward-looking statements. We can give no assurance that such plans, estimates or expectations will be achieved and therefore,
actual results may differ materially from any plans, estimates or expectations in such forward-looking statements. Important factors that
could cause actual results to differ materially from such plans, estimates or expectations include: the parties may not enter into an
agreement providing for the Potential Combination; a condition to the closing of the Potential Combination may not be satisfied; the occurrence
of any event that can give rise to termination of the Potential Combination; a regulatory approval that may be required for the Potential
Combination is delayed, is not obtained in a timely manner or at all or is obtained subject to conditions that are not anticipated; Smurfit
Kappa is unable to achieve the synergies and value creation contemplated by the Potential Combination; Smurfit Kappa is unable to promptly
and effectively integrate WestRock’s businesses; management’s time and attention is diverted on issues related to the Potential
Combination; disruption from the Potential Combination makes it more difficult to maintain business, contractual and operational relationships;
credit ratings decline following the Potential Combination; legal proceedings are instituted against Smurfit Kappa or WestRock; Smurfit
Kappa or WestRock are unable to retain or hire key personnel; the announcement or the consummation of the Potential Combination has a
negative effect on the market price of the capital stock of Smurfit Kappa or WestRock or on Smurfit Kappa or WestRock’s operating
results; evolving legal, regulatory and tax regimes; changes in economic, financial, political and regulatory conditions, in Ireland,
the United Kingdom, the United States and elsewhere, and other factors that contribute to uncertainty and volatility, natural and man-made
disasters, civil unrest, pandemics (e.g., the coronavirus (COVID-19) pandemic (the “COVID-19 pandemic”)), geopolitical uncertainty,
and conditions that may result from legislative, regulatory, trade and policy changes associated with the current or subsequent Irish,
U.S. or U.K. administrations; the ability of Smurfit Kappa or WestRock to successfully recover from a disaster or other business continuity
problem due to a hurricane, flood, earthquake, terrorist attack, war, pandemic, security breach, cyber-attack, power loss, telecommunications
failure or other natural or man-made event, including the ability to function remotely during long-term disruptions such as the COVID-19
pandemic; the impact of public health crises, such as pandemics (including the COVID-19 pandemic) and epidemics and any related company
or governmental policies and actions to protect the health and safety of individuals or governmental policies or actions to maintain the
functioning of national or global economies and markets; actions by third parties, including government agencies; the risk that disruptions
from the Potential Combination will harm Smurfit Kappa’s or WestRock’s business, including current plans and
operations; certain restrictions during the
pendency of the Potential Combination that may impact Smurfit Kappa’s or WestRock’s ability to pursue certain business opportunities
or strategic transactions; Smurfit Kappa’s or WestRock’s ability to meet expectations regarding the accounting and tax treatments
of the Potential Combination; the risks and uncertainties discussed in the “Risks and Uncertainties” section in Smurfit Kappa’s
reports available on the National Storage Mechanism at https://data.fca.org.uk/#/nsm/nationalstoragemechanism and on its website at https://www.smurfitkappa.com/investors;
and the risks and uncertainties discussed in the “Risk Factors” and “Information Regarding Forward-Looking Statements”
sections in WestRock’s reports filed with the SEC. These risks, as well as other risks associated with the Potential Combination,
will be more fully discussed in the proxy statement/prospectus, the shareholder circular, the UK listing prospectus and the other relevant
materials filed with the SEC and applicable securities regulators in the United Kingdom. The list of factors presented here should not
be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional
obstacles to the realization of forward-looking statements. We caution you not to place undue reliance on any of these forward-looking
statements as they are not guarantees of future performance or outcomes and that actual performance and outcomes, including, without limitation,
our actual results of operations, financial condition and liquidity, and the development of new markets or market segments in which we
operate, may differ materially from those made in or suggested by the forward-looking statements contained in this communication. Except
as required by law, none of Smurfit Kappa, WestRock or SW assume any obligation to update or revise the information contained herein,
which speaks only as of the date hereof.
Nothing in this announcement should be construed
as a profit estimate or profit forecast. No statement in this announcement, including statements regarding the potential effect of the
Potential Combination on cash flows and capital returns should be interpreted to mean that cash flows or capital returns of Smurfit Kappa,
WestRock or SW for the current or future financial years would necessarily match or exceed the historical cash flows or capital returns
of Smurfit Kappa or WestRock.
Completion of the Potential Combination would
be subject to the satisfaction of several conditions as referenced elsewhere in this announcement. Consequently, there can be no certainty
that the completion of the Potential Combination would be forthcoming.
This announcement is not a prospectus for the
purposes of the UK Prospectus Regulation Rules or the EU Prospectus Regulation. It has been prepared solely for the Potential Combination
referred to in this announcement.
Certain figures contained in this announcement,
including financial information, have been subject to rounding adjustments. Accordingly, in certain instances, the sum or percentage change
of the numbers contained in this announcement may not conform precisely with the total figure given. Except as explicitly stated in this
announcement, none of the contents of Smurfit Kappa's or WestRock's websites, nor any website accessible by hyperlinks on Smurfit Kappa's
or WestRock's websites, is incorporated in or forms part of, this announcement.
Notes
Unless otherwise stated: financial information
relating to Smurfit Kappa has been extracted or derived from the audited results for the twelve months ended 31 December 2022 and unaudited
results for the six months ended 30 June 2023 and financial information relating to WestRock has been extracted or derived from the audited
results for the twelve months ended 30 September 2022, and the unaudited results up until the third quarter ended 30 June 2023.
Smurfit Kappa financials are prepared under
IFRS and certain adjustments have been made to prepare the estimated adjusted EBITDA for Smurfit WestRock. This, and certain other statements,
are based on non-IFRS and non-US GAAP financial information on Smurfit Kappa and WestRock. These statements may be subject to amendment
in the Circular and Prospectus.
Sources of information and bases of calculation
| 1. | Any references to Smurfit WestRock adjusted EBITDA are based
on the following estimates and adjustments: |
| · | Smurfit Kappa’s EBITDA
of €2,230 million for the last twelve months, as of 30 June 2023, less operating lease expenses of
€108 million, and converted to U.S. Dollars using an exchange rate of 1.05x, being the average exchange rate over the last twelve
months ended 30 June 2023, implying a Smurfit Kappa EBITDA of $2,289 million; and |
| · | WestRock’s pro forma EBITDA
of $3,228 million for the last twelve months, as of 30 June 2023, which is based on the following pro forma adjustments: |
| i. | WestRock EBITDA of $3,162 million; |
| ii. | Subtracting the estimated EBITDA contribution from Joint
Ventures and Associates of $30 million; |
| iii. | Subtracting the estimated EBITDA contribution from RTS Packaging
of $37 million; |
| iv. | Adding back estimated EBITDA contribution from Gondi of $59
million; and |
| v. | Adding back share-based compensation of $75 million. |
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