Smurfit Kappa Acquisitions ULC and Smurfit Kappa Treasury ULC Announce Launch of Consent Solicitation

THIS ANNOUNCEMENT RELATES TO THE DISCLOSURE OF INFORMATION THAT QUALIFIED OR MAY HAVE QUALIFIED AS INSIDE INFORMATION WITHIN THE MEANING OF ARTICLE 7(1) OF THE MARKET ABUSE REGULATION (EU) 596/2014.

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO, OR TO ANY PERSON LOCATED OR RESIDENT IN, ANY JURISDICTION WHERE IT IS UNLAWFUL TO RELEASE, PUBLISH, OR DISTRIBUTE THIS DOCUMENT.

Smurfit Kappa Acquisitions Unlimited Company and Smurfit Kappa Treasury Unlimited Company Announce Consent Solicitation Relating to the

€1,000,000,000 2.875% Senior Notes due 2026 (the “SKA Notes”)

€750,000,000 1.500% Senior Notes due 2027 (the “2027 SKT Notes”)

€500,000,000 0.500% Senior Notes due 2029 (the “2029 SKT Notes”)

and 

€500,000,000 1.000% Senior Notes due 2033 (the “2033 SKT Notes”, and together with the 2027 SKT Notes and the 2029 SKT Notes, the “SKT Notes”, together with the SKA Notes, the “Notes”)

Smurfit Kappa Acquisitions Unlimited Company, the issuer of the SKA Notes (the “SKA Notes Issuer”), and Smurfit Kappa Treasury Unlimited Company, the issuer of the SKT Notes (the “SKT Notes Issuer”, and together with the SKA Notes Issuer, the “Issuers”), wholly-owned subsidiaries of Smurfit Kappa Group plc (“Smurfit Kappa”), announce today that they commenced a consent solicitation through which they are soliciting consents (“Consents”) from registered holders (“Holders”) of their respective Notes as described in the table below (the “Consent Solicitation”) to amend certain terms of the relevant indentures governing such Notes (each, an “Indenture” and together, the “Indentures”). The terms and conditions of the Consent Solicitation are set forth in a consent solicitation statement dated as of 27 September 2023 (as it may be amended and supplemented from time to time, the “Consent Solicitation Statement”). Adoption of the proposed amendments with respect to each series of Notes requires the Consent of the Holders of at least a majority in aggregate principal amount of the then outstanding Notes of such series (the “Required Consents”).

Unless otherwise indicated, capitalized terms used but not otherwise defined in this announcement have the meanings given in the Consent Solicitation Statement.

Details of the Notes and Consent Solicitation

 

Background and Purpose of the Consent Solicitation

The purpose of the Consent Solicitation is to obtain Consents from the Holders to (i) amend the definition of “Change of Control” applicable to the relevant series of the Notes under the relevant Indentures to add an exception for the acquisition of the entire issued share capital of Smurfit Kappa by Cepheidway Limited, a private company limited by shares organized under the laws of Ireland, to be renamed and re-registered as Smurfit WestRock plc, a public company limited by shares organized under the laws of Ireland, by means of a scheme of arrangement under Section 450 of the Companies Act 2014 of Ireland, in connection with the previously disclosed proposed business combination of the Smurfit Kappa group and WestRock Company, a Delaware corporation, announced by Smurfit Kappa on 12 September 2023 (the “Merger”); (ii) amend the Indentures to allow the ongoing financial reporting covenants and other related requirements under the Indentures to be prepared by Smurfit WestRock in accordance with U.S. generally accepted accounting principles and not IFRS; and (iii) make any other changes of a technical or conforming nature to the Indentures necessary or desirable for the implementation of the proposed amendments. 

Expiration Time – Effective Time – Revocation of Consents

The Consent Solicitation will expire at 4:00 p.m., London time, on 5 October 2023, unless the Consent Solicitation is extended or earlier terminated by either the SKA Notes Issuer or the SKT Notes Issuer with respect to any or all series of its respective Notes, in its sole discretion (the “Expiration Time”). The proposed amendments will be effected by way of supplemental indentures (the “Supplemental Indentures”) to the relevant Indentures. A Holder may validly revoke its Consent with respect to the relevant Notes prior to the earlier of the Expiration Time and the time of execution of the relevant Supplemental Indenture, as described in the Consent Solicitation Statement (the “Revocation Deadline”). If the proposed amendments become effective and operative with respect to any series of the Notes, all Holders of such series of Notes (and their transferees) will be bound by the proposed amendments whether or not such Holders consented to the proposed amendments.

Consent Payment

SKA Notes Consent Payment

SKA Notes Holders who have validly delivered their Consent prior to the Expiration Time and who have not validly revoked such Consent prior to the Revocation Deadline, will receive a payment equal to €2.50 per €1,000 aggregate principal amount of the SKA Notes with respect to which such Consent has been delivered (the “SKA Notes Consent Payment”).

SKT Notes Consent Payment

SKT Notes Holders who have validly delivered their Consent prior to the Expiration Time and who have not validly revoked such Consent prior to the Revocation Deadline, will receive a payment equal to:

• €3.75 per €1,000 aggregate principal amount of the 2027 SKT Notes with respect to which such Consent has been delivered (the “2027 SKT Notes Consent Payment”);
• €6.25 per €1,000 aggregate principal amount of the 2029 SKT Notes with respect to which such Consent has been delivered (the “2029 SKT Notes Consent Payment”); and
• €8.75 per €1,000 aggregate principal amount of the 2033 SKT Notes with respect to which such Consent has been delivered (the “2033 SKT Notes Consent Payment”, and together with the 2027 SKT Notes Consent Payment and 2029 SKT Notes Consent Payment, the “SKT Notes Consent Payment”, and together with the SKA Notes Consent Payment, the “Consent Payment”).

Holders who have validly delivered their Consents prior to the Expiration Time but who have validly revoked their Consents prior to the Revocation Deadline with respect to a series of the Notes will not be eligible to receive the applicable Consent Payment unless they validly deliver their Consents again prior to such Expiration Time, and do not validly revoke their Consents again prior to the Revocation Deadline with respect to such series of the Notes.

In the event that the Required Consents have been received with respect to some series of the Notes but not with respect to all series of the Notes for which Consents are being solicited under the Consent Solicitation Statement, the Issuers may, in their sole discretion, terminate the solicitation with respect to any series of Notes for which the Required Consents have been received and the relevant Supplemental Indentures with respect to such series of the Notes will not be executed. As per the conditions precedent set forth under the Consent Solicitation Statement, if the relevant Supplemental Indenture is not executed, no Consent Payment would be payable to Holders of such series of the Notes even if the Required Consents for such series have been received. 

Key Dates

Date	Calendar Date	Event
Solicitation Launch Date	27 September  2023	Commencement of the Solicitation.
Expiration Time	4:00 p.m., London Time, on 5 October 2023 unless extended or earlier terminated by the applicable Issuer with respect to its Solicitation in its sole discretion.	The deadline for Holders to validly deliver Consents to the Proposed Amendments in order to qualify for the applicable Consent Payment. Holders who validly deliver their Consents prior to the Expiration Time and do not validly revoke their Consents prior to the Revocation Deadline will receive the applicable Consent Payment on the Consent Payment Date.
Effective Time	The time at which the relevant Required Consents are received, and the applicable Supplemental Indenture is executed.	The time at which the applicable Supplemental Indenture will be executed, and the Proposed Amendments will become effective and operative with respect to the relevant Notes.
Revocation Deadline	The earlier of the Expiration Time and the Effective Time.	The deadline for Holders to validly revoke their Consents. A valid revocation of a Consent will result in a Holder not being eligible to receive the applicable Consent Payment unless another Consent is validly delivered prior to the Expiration Time.
Announcement of Solicitation Results	As soon as practical after the earlier of the Effective Time and the Expiration Time	The date on which the results of the Solicitation are announced by each Issuer and/or Smurfit Kappa via press release, by sending a notice via the Clearing Systems and by posting a notice on Euronext Dublin’s website.
Consent Payment Date	At or promptly after the Expiration Time and satisfaction (or waiver) of the conditions for the applicable Consent Payment described herein (expected to be 9 October 2023, unless the Expiration Time for the applicable series of Notes is extended or earlier terminated by the applicable Issuer in its sole discretion).	The date on which the applicable Consent Payment is paid to the cash accounts of Euroclear or Clearstream, as applicable, for credit to Holders who validly delivered Consents prior to the Expiration Time and did not validly revoke such Consents prior to the Revocation Deadline as determined by the relevant Issuer in its sole and absolute discretion.

Either the SKA Notes Issuer or the SKT Notes Issuer with respect to any or all series of its respective Notes, may in its sole discretion terminate, extend or amend the Consent Solicitation and the deadlines thereunder.

Credit Rating Update

Following the announcement of the Merger, Moody’s Investors Service, Inc. placed Smurfit Kappa’s credit rating on review for upgrade, S&P Global Ratings placed Smurfit Kappa’s credit rating on CreditWatch Positive and Fitch Ratings, Inc. placed Smurfit Kappa’s long-term default rating on Rating Watch Positive.

A credit rating is not a recommendation to buy, sell or hold securities and may be revised or withdrawn by the relevant rating agency at any time.

Further Information

The Issuers have retained Citigroup Global Markets Limited to act as solicitation agent (the “Solicitation Agent”). Kroll Issuer Services Limited will act as tabulation agent and information agent for the Consent Solicitation. Requests for documents may be directed to Kroll Issuer Services Limited at +44 20 7704 0880 or by email to smurfit@is.kroll.com. Questions regarding the Consent Solicitation may be directed to Citigroup Global Markets Limited at +44 20 7986 8969  and +1 (800) 558-3745 or by email to liabilitymanagement.europe@citi.com.
This announcement is for information purposes only and does not constitute an offer to purchase any of the Notes or a solicitation of an offer to sell any of the Notes and shall not be deemed to be an offer to purchase or a solicitation of an offer to sell any securities of the Issuers, or their respective subsidiaries or affiliates. The Consent Solicitation is only being made pursuant to the terms of the Consent Solicitation Statement. No recommendation is being made as to whether Holders should consent to the proposed amendments. The Consent Solicitation is not being made in any jurisdiction in which, or to or from any person to or from whom, it is unlawful to make such solicitation under applicable state or foreign securities or “blue sky” laws.

This announcement is released by each of the Issuers and contains information that, prior to publication, qualified as inside information for the purposes of Article 7 of Market Abuse Regulation (EU) 596/2014 (“MAR”), encompassing information relating to the Consent Solicitation described above. The person responsible for arranging for the release of this announcement on behalf of the Issuers is Gillian Carson-Callan, Company Secretary. The date and time of this announcement is the same as the date and time that it has been communicated to the media, at 2:30 p.m., London time, on 27 September 2023.

Inquiries:

Smurfit Kappa
Ciarán Potts
Head of Investor Relations
T: +353 1 202 7000
E: ir@smurfitkappa.com

Disclaimer

This announcement must be read in conjunction with the Consent Solicitation Statement. This announcement and the Consent Solicitation Statement contain important information which should be read carefully before any decision is made with respect to the Consent Solicitation. Each Holder is recommended to seek its own independent advice immediately from its own appropriately authorized independent financial, tax or legal advisors, stockbroker, bank manager or accountant. Any individual or company whose Notes are held on its behalf by a broker, dealer, bank, custodian, trust company or other nominee or intermediary must contact such entity if it wishes to participate in the Consent Solicitation. None of Smurfit Kappa or the Issuers or any of their respective directors, officers, employees, agents or affiliates has made or will make any assessment of the merits and risks of the Consent Solicitation on the interests of Holders nor are they providing Holders with any legal, business, tax, financial, investment, accounting or other advice in this announcement and/or the Consent Solicitation Statement and/or in connection with the Consent Solicitation. 

In accordance with normal and accepted market practice, the trustee appointed in relation to the Notes (the “Trustee”) and the Solicitation Agent have not been involved in formulating the Consent Solicitation and make no representation that all information has been disclosed to Holders in the Consent Solicitation Statement. The Trustee and the Solicitation Agent express no opinion as to the merits of the Consent Solicitation or the proposed amendments outlined in the Consent Solicitation Statement.

The distribution of this announcement and the Consent Solicitation Statement in certain jurisdictions may be restricted by law, and persons into whose possession this announcement or the Consent Solicitation Statement comes are requested to inform themselves about, and to observe, any such restrictions.

Information Regarding Forward-Looking Statements

This announcement contains certain forward-looking statements. All statements, other than statements of historical fact, included in this announcement regarding future events or prospects are forward-looking statements. The words “aim,” “anticipate,” “believe,” “continue,” “estimate,” “expect,” “future,” “help,” “intend,” “may,” “plan,” “shall,” “should,” “will” or the negative or other variations of them as well as other statements regarding matters that are not historical fact, are or may constitute forward-looking statements. Smurfit Kappa and the Issuers have based these forward-looking statements on respective management’s current view with respect to future events and financial performance. These views reflect the best judgment of Smurfit Kappa’s or the Issuers’ management but involve a number of risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may differ materially from those predicted in Smurfit Kappa’s or the Issuers’ forward-looking statements and from past results, performance or achievements. All forward-looking statements contained in this announcement are qualified in their entirety by this cautionary statement. See the half yearly report of Smurfit Kappa for the six months ended 30 June 2023, filed with the London Stock Exchange for certain principal risks and uncertainties relating to Smurfit Kappa.

There is no intention to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. All subsequent written or oral forward-looking statements attributable to Smurfit Kappa or the Issuers, or persons acting on their behalf, are expressly qualified in their entirety by the cautionary statements contained throughout this announcement. As a result of these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements.