28.01.2015

MWV and RockTenn Agree to Combination Creating a $16 Billion Global Packaging Leader

Rock-Tenn Company (“RockTenn”) and MeadWestvaco Corporation (“MWV”) today announced that they have entered into a definitive combination agreement to create a leading global provider of consumer and corrugated packaging (“NewCo”) in a transaction with a combined equity value of $16 billion.

The combined company, to be named prior to closing, will have combined net sales of $15.7 billion and adjusted EBITDA of $2.9 billion, including the impact of $300 million in estimated annual synergies to be achieved over three years.

Under the terms of the agreement, which has been unanimously approved by the boards of directors of both companies, MWV stockholders will receive 0.78 shares of NewCo for each share of MWV held. RockTenn shareholders will be entitled to elect to receive either (a) 1.00 shares of NewCo or (b) cash in an amount equal to the volume weighted average price of RockTenn common stock during a five-day period ending three trading days prior to closing for each share of RockTenn held. The cash and stock elections by RockTenn shareholders will be subject to proration such that the resulting ownership of NewCo will be approximately 50.1% by MWV shareholders and 49.9% by RockTenn shareholders, and based on the shares outstanding today, approximately 7% of RockTenn shares will receive cash in lieu of stock. This targeted ownership ratio of NewCo will facilitate the continued favorable tax attributes of the previously announced spin-off of MWV’s specialty chemicals business, which the parties intend to complete after the closing of the business combination.

Steven C. Voorhees, chief executive officer of RockTenn, said, “This transaction brings together two highly complementary organizations to create a new, more powerful company with leadership positions in the global consumer and corrugated packaging markets. This is a terrific opportunity for shareholders, employees and customers of both companies, all of whom stand to benefit enormously from the combination. Importantly, our two companies are also an exceptional cultural fit, sharing a commitment to exceeding customer expectations and a focus on developing innovative packaging solutions. Planning for the integration of these two companies has already started and we expect to expeditiously realize the full value of cost synergies we have identified.”


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