425: Smurfit WestRock Outlines Share Settlement and Trading Procedures Post-Combination

Smurfit WestRock provides detailed FAQs regarding the settlement and trading of its shares following the completion of the combination with WestRock, including information for Smurfit Kappa shareholders.

Summary

• This document provides answers to frequently asked questions regarding the settlement and trading of Smurfit WestRock shares after the combination of Smurfit Kappa and WestRock.
• The combination is expected to be completed in early July 2024.
• Smurfit WestRock will be headquartered in Dublin, Ireland, with North and South American operations based in Atlanta, Georgia.
• Smurfit WestRock shares will be listed on both the New York Stock Exchange (NYSE) under the symbol 'SW' and the London Stock Exchange (LSE) under the symbol 'SWR'.
• Smurfit Kappa's listings on Euronext Dublin and the LSE will be cancelled.
• The ISIN for Smurfit WestRock shares is IE00028FXN24, and the CUSIP is G8267P 108.
• The number of shares held will remain unchanged after the completion.
• Trading on Euronext Dublin for Smurfit Kappa shares is expected to end on July 2, 2024.
• Holders of Smurfit Kappa shares through American Depositary Receipts (ADRs) should contact their ADR Bank to understand their options, as the ADR programs are expected to be terminated.
• Existing Smurfit Kappa CDI holders will receive Smurfit WestRock Depositary Interests (DIs) on a one-for-one basis.
• Existing Smurfit Kappa Euroclear Holders are encouraged to contact their Euroclear participant to confirm steps to take prior to the Scheme Record Time.
• Certificated holders of Smurfit Kappa Shares will be recorded as registered holders of Smurfit WestRock Shares.
• Computershare Ireland was appointed as the new Irish share registrar for Smurfit Kappa, and after completion, Computershare US will be the Transfer Agent.
• The Scheme Record Time is 5:00 p.m. (New York City Time) on July 5, 2024.
• Smurfit WestRock Shares are expected to be issued to Smurfit Kappa and WestRock shareholders after 5:00 p.m. (New York City Time) on July 5, 2024.
• Delisting of Smurfit Kappa Shares from Euronext Dublin and the LSE is expected on July 8, 2024.
• Admission and commencement of dealings in Smurfit WestRock Shares on the LSE is expected at 8:00 a.m. on July 8, 2024.
• Admission and commencement of dealings in Smurfit WestRock Shares on the NYSE is expected at 9:30 a.m. (New York City Time) on July 8, 2024.

Sentiment

Score: 7

Explanation: The document is largely procedural and informative, outlining the steps for shareholders to manage their holdings following the merger. The sentiment is neutral to slightly positive, as the merger is expected to create a larger, more competitive company.

Positives

• Listing on both NYSE and LSE provides flexibility for shareholders to trade and settle shares.
• Existing Smurfit Kappa CDI holders will seamlessly transition to Smurfit WestRock DIs.
• Shareholders can choose to hold their shares in CREST, through a DTC Participant, or in registered form.
• Clear guidance is provided for various types of shareholders (CDI holders, Euroclear holders, certificated holders) on how to manage their shares post-completion.

Negatives

• Smurfit Kappa Shares will no longer be included in the FTSE 100 index.
• ADR programs are expected to be terminated, potentially forcing a sale of underlying shares if holders do not reposition their holdings.
• Euroclear participants receiving Smurfit WestRock Shares in registered form may face delays in trading and settlement.
• Certificated holders may face additional procedural requirements and costs when transferring shares.

Risks

• Delays in obtaining regulatory clearances and consents could alter the expected timetable.
• Failure to reposition ADR holdings in time may result in a forced sale of underlying Smurfit WestRock Shares.
• Euroclear participants may experience disruptions in trading and settlement during the transfer of indirect holdings to direct holdings.
• Additional costs and delays may arise for shareholders holding shares in registered form due to transfer requirements and medallion signature guarantees.

Future Outlook

The document outlines the expected steps and timeline for the completion of the combination and the subsequent listing and trading of Smurfit WestRock shares, but does not provide specific financial guidance or projections.

Industry Context

This announcement is a procedural update related to a major merger in the paper and packaging industry, a sector known for consolidation and cyclical performance. The combined entity aims to achieve greater scale and efficiency in a competitive global market.

Comparison to Industry Standards

• The process of listing on both the NYSE and LSE is similar to other dual-listed companies like Unilever or Rio Tinto, providing access to a broader investor base.
• The use of depositary interests (DIs) in CREST is a standard mechanism for facilitating trading and settlement of international shares in the UK market, comparable to practices used by other foreign companies listed on the LSE.
• The termination of unsponsored ADR programs is a common occurrence following a merger or acquisition, as the combined entity typically focuses on direct listings and sponsored programs.

Stakeholder Impact

• Shareholders of Smurfit Kappa and WestRock will become shareholders of Smurfit WestRock, with their holdings converted according to the terms of the combination.
• Employees of Smurfit Kappa and WestRock will be integrated into the new Smurfit WestRock organization.
• Customers and suppliers of both companies can expect a continuation of services and products under the Smurfit WestRock brand.

Next Steps

• Smurfit Kappa shareholders should follow the instructions provided to ensure a smooth transition of their holdings to Smurfit WestRock shares.
• Existing Smurfit Kappa Euroclear Holders should contact their Euroclear participant to confirm steps to take prior to the Scheme Record Time.
• Certificated holders of Smurfit Kappa Shares should review and update their contact information with Computershare Ireland.
• Smurfit WestRock will issue a separate communication to shareholders regarding the appointment of Computershare US as Transfer Agent.

Key Dates