Shares of packaging giant Smurfit Kappa fell 11% after the WestRock merger announcement

Shares in Dublin-based packaging group Smurfit Kappa fell 11% at the market open on Tuesday in London after it announced it would merge with US peer WestRock to create an industry giant.

The two companies will form Smurfit WestRock – which is set to be one of the world’s largest packaging companies – which will be managed through a holding company established and headquartered in Ireland.

It will seek to list in New York with a standard listing on the London Stock Exchange.

WestRock shareholders will receive one Smurfit WestRock share and $5 in cash, equal to $43.51 per share.

“We’ve always said we had too big a gap in our portfolio because we weren’t as engaged in the US. We’ve looked over many years for a way to get there in a way that would reward our shareholders. In the long term,” said Tony Smurfit, CEO Smurfit Kappa, who will lead the combined company, told CNBC’s Squawk Box Europe.

“We have determined [Westrock] As an asset that we can develop and integrate to become better assets. So, after a series of negotiations, we finally reached an agreement at 7:15 [a.m. London time] “This morning to finally close this transaction, which I think will be great for our shareholders in the long, medium and short term.”

This is a developing story and will be updated soon.

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