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Sep 13, 2023

Packaging group Smurfit Kappa ditches LSE as primary listing as it merges with WestRock

New company Smurfit WestRock to debut on NYSE

Sustainable packing giant Smurfit Kappa has ditched the London Stock Exchange (LSE) as its main listing instead switching to the NYSE following its merger with folding paperboard box manufacturer WestRock.

The new company, named Smurfit WestRock, will instead list on the NYSE and delist from the Irish Stock Exchange, which trades as Euronext Dublin.

Smurfit Kappa says its ordinary shares will be delisted from the premium segment of the Financial Conduct Authority's (FCA) official list and cancelled from admission to trading on the LSE.

Commenting on the merger, Alan Wilson, chair of WestRock, says: ‘This combination will enable WestRock to advance its key growth initiatives on a global scale while providing our shareholders with the opportunity to participate meaningfully in the combined company’s significant upside value potential.’

Opting for the US

The packaging firm joins other high-profile companies such as Arm, Revolut and WE Soda, which all chose to list in the US as its primary or avoid the UK market, citing ‘market volatility’ as main reasons.

WE Soda CEO Alasdair Warren said at the time of the company’s listing that investors, particularly in the UK, ‘remain extremely cautious about the IPO market and this extreme investor caution in London meant we were unable to arrive at a valuation that we believe reflects our unique financial and operating characteristics.’

While more companies this year are favoring the US over the UK market, the FCA has tried to combat this with the introduction of plans to reform and streamline the listing rules to boost the attractiveness of the UK market.

The reform, first announced in 2021, will replace the existing standard and premium listing segments with a single category for equity shares in commercial companies. If applied, the listing reform will also scrap shareholder votes on transactions such as acquisitions to reduce ‘frictions’ to companies.