The new packaging materials and solutions company will be known as BillerudKorsnäs
Swedish packaging materials suppliers Billerud and Korsnäs are to merge into a combined virgin fibre based packaging materials and packaging solutions company, BillerudKorsnäs.
The largest shareholder in the new company will be Korsnäs owner Investment AB Kinnevik, with a 25.1% holding. It said it intends to be an active owner in the new company. Frapag Beteiligungsholding, the current main shareholder in Billerud, will have a 15.7% holding.
The transaction also includes Kinnevik’s 75% share in Latgran Biofuels and Kornäs’ 5% share in Bergvik Skog.
The potential synergy from the transaction is estimated to have an annual value of at least SEK300m, while projected turnover from the new company is estimated at approximately SEK20bn.
“Together with Korsnäs, we are looking forward to creating a leading player within packaging materials with a solid platform for future growth,” said Per Lindberg, president and ceo of Billerud.
Kinnevik ceo and president Mia Brunell Livfors added: “I am convinced that the merger between Korsnäs and Billerud is positive for both Korsnäs and Kinnevik’s shareholders. The cash proceeds resulting from the transaction create additional financial flexibility for Kinnevik, while offering continued exposure to an attractive industry that has been part of the Kinnevik investment story since the company’s inception.”
The transaction will be finalised once approvals have been received from the relevant competition authorities and from the extraordinary general meeting of Billerud shareholders, expected to be held in August or September 2012.