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DS Smith PLC on Thursday said it has received a ‘highly preliminary expression of interest’ from packaging industry peer Mondi PLC about a possible merger, which would create company worth more than £10 billion.
‘The board of DS Smith understands that Mondi is considering a possible offer for DS Smith although no proposal has been received at this stage,’ DS Smith said.
It noted the put-up-or-shut-up deadline for Mondi under UK takeover rules will be March 7.
Mondi did not immediately confirm DS Smith’s announcement, which DS Smith said was made without the approval of Mondi and in response to ‘media speculation’.
DS Smith shares were up 11% to 310.90 pence on Thursday morning in London following the announcement, giving the London-based firm a market capitalisation of £4.28 billion.
Shares in Weybridge, Surrey-based Mondi were down 1.8% at 1,356.50 pence in London, giving a £5.97 billion market cap. Its Johannesburg-listed shares were down 1.2% to R 326.26.
Both companies are FTSE 100 constituents.
As far back as early 2021, Bloomberg had reported that Mondi was considering a tilt at DS Smith, citing at the time ‘people familiar with the matter’. Nothing came of it at that time.
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