WestRock to Acquire KapStone
WestRock Company and KapStone Paper and Packaging Corporation have agreed to a $4.9 billion deal that would enable WestRock to acquire all outstanding shares of KapStone for $35 per share and approximately $1.36 billion in net debt. Founded in 2005 in Northbrook, Illinois, KapStone produces and distributes containerboard, corrugated products and specialty papers, including liner and medium containerboard, kraft papers and saturating kraft. KapStone also owns Victory Packaging with facilities in the United States, Canada and Mexico.
“KapStone is a great fit with WestRock. Their complementary corrugated packaging and distribution operations will enhance WestRock’s ability to serve customers across our system, particularly in the western United States, and the addition of their specialty kraft paper products that we do not make enhances our differentiated portfolio of paper and packaging solutions,” said Steve Voorhees, WestRock CEO, in a prepared statement.
Westrock said the transaction is expected to create annual run-rate cost synergies and performance improvements of approximately $200 million by the end of fiscal 2021 by integrating KapStone operations into WestRock’s corrugated packaging system. The addition of KapStone’s West Coast facilities may improve WestRock’s ability to serve customers in that region while reducing costs across its supply chain. It may also broaden WestRock’s differentiated paper and packaging solutions portfolio with the addition of KapStone’s complementary specialty kraft paper offerings that WestRock does not offer today.