Proactive Investors - Alongside reporting a fall in annual revenue and profits, DS Smith PLC (LON:SMDS) boss Miles Roberts told reporters today that the £5.8 billion takeover of the cardboard box-maker by US rival International Paper is still going ahead, following speculation that the deal may be called off.
Worries that the deal could be derailed have grown on reports that International Paper is fighting to block a potential $15 billion acquisition attempt by Brazilian giant Suzano.
DS Smith agreed to an all-share takeover by International Paper at a price of 415p in April, which would leave shareholders of the FTSE 100 group with 33.7% of the combined group, with the US company agreeing to take a secondary listing in the London Stock Exchange as part of the takeover.
Roberts said both Smith and IP boards and advisers are still "working very diligently on bringing the businesses together", and that the plan for a shareholder vote in September "hasn’t changed at all".
Full-year results from DS Smith today revealed annual profits fell 24% to £503 million as revenue fell 17% to £6.8 billion, which the company said was in line with management expectations, against a weak consumer demand environment and high inflation.
Packaging box volumes fell 2% but improved over the year with growth of 2% in the fourth quarter and have continued into the current financial year.
Increasing demand is resulting in higher paper and other input costs, but this is anticipated to be reflected in packaging price rises, with benefits expected to be weighted to the second half of the financial year.