US-based paperboard packaging company Smurfit-Stone Container said its investors have urged a judge to obstruct a $3.5bn acquisition bid by Georgia-based packaging firm Rock-Tenn.
Smurfit-Stone investors have opposed the bid because Rock-Tenn’s offer doesn’t provide enough money for the company’s shares. Third Point, Royal Capital Management and Monarch Alternative Capital, which collectively own about 9% of Smurfit-Stone’s shares, have agreed to vote against the deal.
In the beginning of 2011, Rock-Tenn announced its plan to buy Smurfit-Stone for about $35 a share, half in cash and half in Rock-Tenn stock.
If the deal is signed, it would create North America’s second-biggest containerboard producer after Memphis based International Paper.
In 2009, Smurfit-Stone sought bankruptcy protection from creditors as a result of the economic decline in the U.S. As part of its bankruptcy case, the firm cleared $3bn in debt by giving shareholders 4.5% of the reorganised company.
Smurfit-Stone manufactures paper-based packaging and corrugated containers, has 12 paper mills, 110 container plants and 29 reclamation plants.