WestRock will focus on cutting debt; balance sheet ‘is in good shape’

By Devika Patel

Knoxville, Tenn., Nov. 5 – WestRock Co. plans to focus on reducing debt after completing a $4.9 billion acquisition, but the company’s balance sheet “is in good shape,” an executive said.

The company’s leverage ratio at the end of the quarter was 2.07x, but leverage increased to 3x following the company’s Nov. 2 acquisition of KapStone Paper and Packaging Corp.

WestRock financed the transaction through the issuance of debt from a bank term loan facility, existing credit commitments and cash on hand.

“Our balance sheet is in good shape,” president and chief executive officer Steven C. Voorhees said on the company’s fourth quarter and year ended Sept. 30 earnings conference call on Monday.

“Our pro forma leverage after completion of the [Kapstone] transaction will be about 3x, which sets us up well to return our leverage to our target of 2.25x to 2.5x.

“[With] our leverage ratio at 3x, we’re going to have an increased focus on reducing debt,” he said.

WestRock is an Atlanta-based paper and packaging manufacturer.

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