The US company that's considering a massive takeover bid for one of the UK's largest packaging companies, DS Smith, has said it would set up a European HQ in London and aim to list its shares in the City.
International Paper stated that if it wins the potential bid for DS Smith, it would keep the company's current headquarters. It also said that "key elements" of the roles at DS Smith's London office would be kept, depending on "consultation with impacted employees".
The company, based in Memphis, would also "seek a secondary listing of its shares on the London Stock Exchange", it added. Previously, the company had hinted at a possible £5.7billion offer for DS Smith, to be paid in shares.
This followed DS Smith agreeing in principle to a £5.1billion deal with London-listed rival Mondi. The business believes that if a deal is struck, it could save around £407million a year within four years.
These savings would partly come from reduced freight costs and better deals with suppliers due to increased buying power. However, achieving these savings would cost about £293million and take roughly four years to fully realise.
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"International Paper intends to maintain key elements of DS Smith's headquarters functions and is proposing to establish a European headquarters in London, United Kingdom, at DS Smith's existing headquarters (subject to any required information and consultation with any impacted employees and/or their representatives in accordance with applicable law)," the company explained.
Andy Silvernail, who is set to become the chief executive of International Paper, said: "I believe the combination of International Paper and DS Smith would create a winning position in renewable packaging and would be a strong catalyst to drive profitable growth and create value."
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