European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>Following the withdrawal of <a href="https://www.smartkarma.com/entities/mondi-plc" target="_blank" data-smartkarma-citation="entities:22048:1" rel="noopener">Mondi PLC (MNDI LN)</a> from the contest to acquire <a href="https://www.smartkarma.com/entities/ds-smith-plc" target="_blank" data-smartkarma-citation="entities:22150:1" rel="noopener">DS Smith PLC (SMDS LN)</a>, the gross spread to the deal turned negative (from &gt;10%).</li>
<li>At the median 7.07x EV/Fwd NTM EBITDA (within the range of former transactions), the implied equity value of DS Smith would be 388.4p. (vs. an IBES consensus TP of 395p).</li>
<li>IP is giving away most of the synergies. Spread is 1.91%/2.86% (gross, annualized assuming settlement by Y/E). I would wait for the spread to widen, before setting it up.</li>
</ul>


Following the withdrawal of Mondi PLC (MNDI LN) from the contest to acquire DS Smith PLC (SMDS LN), the gross spread to the deal turned negative (from &gt;10%).
At the median 7.07x EV/Fwd NTM EBITDA (within the range of former transactions), the implied equity value of DS Smith would be 388.4p. (vs. an IBES consensus TP of 395p).
IP is giving away most of the synergies. Spread is 1.91%/2.86% (gross, annualized assuming settlement by Y/E). I would wait for the spread to widen, before setting it up.


Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

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Equity Bottom-Up

International Paper Co / Equity Bottom-Up

<ul><li>International Paper had a challenging start to 2023 as its revenue was slightly down though still above analyst expectations.</li><li>International Paper reported $65 million of year-over-year incremental earnings benefits from building better IP initiatives, but lower prices across their portfolio and weaker demand impacted margins.</li><li>Despite these challenges, International Paper remained focused on their key priorities of taking care of employees, customers and maximizing shareholder value.</li></ul>

International Paper had a challenging start to 2023 as its revenue was slightly down though still above analyst expectations.International Paper reported $65 million of year-over-year incremental earnings benefits from building better IP initiatives, but lower prices across their portfolio and weaker demand impacted margins.Despite these challenges, International Paper remained focused on their key priorities of taking care of employees, customers and maximizing shareholder value.

International Paper Company: How Long Will The Struggles Continue? – Key Drivers

<ul><li>Despite high inflation and declining demand in the second half of the year, International Paper managed a fair result.</li><li>Despite the strong marketing efforts, the company failed to meet the revenue expectations of Wall Street.</li><li>International Paper has made strategic investments to support the profitable development potential across its Industrial Packaging business.</li></ul>

Despite high inflation and declining demand in the second half of the year, International Paper managed a fair result.Despite the strong marketing efforts, the company failed to meet the revenue expectations of Wall Street.International Paper has made strategic investments to support the profitable development potential across its Industrial Packaging business.

Credit

<ul><li>International Paper Company is one of the largest manufacturers of renewable fiber-based industrial packaging and pulp products.</li><li>The company has been facing a challenging and dynamic environment and has experienced a sharp decline in the demand for its Industrial Packaging segment and higher cost headwinds significant from higher distribution and energy costs.</li><li>Operating margins have been lower because of significant macro headwinds and International Paper saw a decline across all the end-use segments.</li></ul>

International Paper Company is one of the largest manufacturers of renewable fiber-based industrial packaging and pulp products.The company has been facing a challenging and dynamic environment and has experienced a sharp decline in the demand for its Industrial Packaging segment and higher cost headwinds significant from higher distribution and energy costs.Operating margins have been lower because of significant macro headwinds and International Paper saw a decline across all the end-use segments.

International Paper Company: Detailed Credit Analysis & Financial Strength Evaluation Report

<ul><li>This is our first report on International Paper Company, one of the largest producers of renewable fiber-based industrial packaging and pulp products.</li><li>It has been a challenging and dynamic environment for International Paper and the company experienced a sharp decline in the demand for its Industrial Packaging segment and higher cost headwinds significant from higher distribution and energy costs.</li><li>Operating margins were lower because of significant macro headwinds and International Paper saw a decline across all the end-use segments.</li></ul>

This is our first report on International Paper Company, one of the largest producers of renewable fiber-based industrial packaging and pulp products.It has been a challenging and dynamic environment for International Paper and the company experienced a sharp decline in the demand for its Industrial Packaging segment and higher cost headwinds significant from higher distribution and energy costs.Operating margins were lower because of significant macro headwinds and International Paper saw a decline across all the end-use segments.

International Paper Company: Initiation of Coverage – Business Model & Key Drivers

United States

Crown Holdings, Inc. designs, manufactures, and sells packaging products for consumer goods through plants located in countries around the world.  The Company's primary products include steel and aluminum cans for food, beverage, household, and other consumer products.  Crown also provides a variety of metal caps, closures, and dispensing systems.

WestRock Company provides consumer and corrugated packaging solutions. The Company offers merchandising displays, paperboard, recycling, and waste solutions. WestRock conducts business in the United States.

AptarGroup, Inc. designs, manufactures, and markets pumps, dispensing closures, and aerosol valves.  The Company's products are used for fragrance/cosmetics, personal care, pharmaceutical, household/industrial, and food products. AptarGroup operates worldwide.

Ball Corporation provides metal packaging for beverages, foods, and household products. The Company also supplies aerospace and other technologies and services to commercial and governmental customers. Ball serves customers worldwide.

Avery Dennison Corporation produces pressure-sensitive materials and a variety of tickets, tags, labels and other converted products. The Company's pressure sensitive products are used in labeling, decorating, and specialty applications. Avery Dennison's non-pressure sensitive products include tickets, tags, RFID inlays, and services for retailers, apparel manufacturers and brand owners.

Graphic Packaging Holding Company is an integrated provider of paperboard and integrated paperboard packaging solutions to multinational beverage and consumer products companies.  The Company manufactures folding cartons for frozen and non-frozen food and beverage products.

Graphic Packaging Holding Company (GPK US)

Berry Global Group Inc. manufactures plastic products and containers. The Company produces agricultural film, moisture control products for buildings, closures, disposable cutlery, drop cloths, flexible packaging, overcaps, tapes, tubes, bottles, drink cups, lids, and trash bags. Berry Plastics markets its products worldwide.

Packaging Corporation of America manufactures containerboard and corrugated packaging products for use in protecting goods during shipment.  The Company also produces multi-color boxes and displays, as well as meat boxes and wax-coated boxes for the agricultural industry.

Packaging Corporation of America (PKG US)

Sealed Air Corporation manufactures packaging and performance-based materials and equipment systems that serve food, industrial, medical, and consumer applications.

Greif Inc. manufactures and markets industrial packaging products and services. The Company provides steel, plastic, fiber, corrugated and multiwall containers. Greif also produces containerboard and has operations nationwide.

Amcor Limited is an international integrated packaging company offering packaging and related services.  Amcor primarily produces a wide range of packaging products which include corrugated boxes, cartons, aluminum and steel cans, flexible plastic packaging, PET plastic bottles and jars, and multi-wall sacks.

DS Smith Plc is an International paper company focused on packaging and office products. The Group collects waste paper, manufactures paper, converts corrugated packaging and produces bag-in-box, plastic corrugated and heavy duty corrugated packaging, as well as wholesales office supplies.

CCL Industries Inc. supplies manufacturing services and specialty packaging products for the non-durable consumer products market.  The Company provides formulation and manufacturing services, labels, aluminum and plastic specialty tubes, containers, and closures to marketers of cosmetic, personal care, pharmaceutical, household, and specialty food products.

Huhtamaki Oyj manufactures consumer packaging products.  The Company produces disposable food service and tableware products, such as cups, plates, and trays, as well as containers for fresh meats, fruits, dairy products, frozen foods, coffee, and detergents.  Huhtamaki makes the containers of paper, molded fibers, and plastics.  The Company manufactures in many countries and sells worldwide.

Klabin S.A. produces, exports, and recycles paper. The Company's products include packaging paper and board, corrugated boxes, industrial sacks and timber in logs for saw mills and veneer plants.

Toyo Seikan Group Holdings Ltd primarily manufactures, markets, and sells metal, plastic, and glass packaging products and containers.  The Company specializes in food cans, 18-liter cans, and other beverage cans.  Toyo Seikan also produces steel products such as steel sheets.

Vidrala SA manufactures glass bottles and markets them throughout Europe.  The Company produces bottles for beverages, vegetable oils, and preserves.

BillerudKorsnas AB offers primary fibre-based renewable packaging materials and packaging solutions used for consumer packaging and industrial purposes.

Mayr-Melnhof Karton AG manufactures cardboard, folding cartons, and packaging materials primarily from recycled wastepaper.  The Company operates production facilities in Austria and throughout Europe.

International Paper Company produces and distributes paperboard-based industrial and consumer packaging, uncoated printing & writing papers and market pulp. It maintains a global network of manufacturing operations in North America, Europe, Latin America, Russia and Asia.

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International Paper Co (IP US)

International Paper/DS Smith: Spread

Following the withdrawal of Mondi from the contest to acquire DS Smith, the IP/SMDS gross spread to the deal turned negative (from +10%)....

Jesus Rodriguez Aguilar

International Paper Company: How Long Will The Struggles Continue? – Key Drivers

International Paper had a challenging start to 2023 as its revenue was slightly down though still above analyst expectations. International Paper...

Baptista Research

International Paper: Major Drivers

Despite high inflation and declining demand in the second half of the year, International Paper managed a fair result. Despite the strong...

Baptista Research

International Paper Company: Detailed Credit Analysis & Financial Strength Evaluation Report

International Paper Company is one of the largest manufacturers of renewable fiber-based industrial packaging and pulp products. The company has...

Baptista Research

International Paper Company: Initiation of Coverage – Business Model & Key Drivers

This is our first report on International Paper Company, one of the largest producers of renewable fiber-based industrial packaging and pulp...

Baptista Research

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