Smurfit wins out over Stone in battle for corporate ethos

A year ago, when Michael Smurfit and Roger Stone told the world about their well-flagged merger, the marriage of Smurfit and …

A year ago, when Michael Smurfit and Roger Stone told the world about their well-flagged merger, the marriage of Smurfit and Stone was being described as a merger of equals. Roger Stone would be president and chief executive for a couple of years after the merger, while Smurfit's Ray Curran would pack his bags for Chicago and get to grips with the nitty-gritty of the cost-cutting needed to get this merger to work.

Some at the time were not convinced that this corporate structure would work and, judging by the events of last week, it seems pretty clear that marrying the contrasting corporate ethos of Smurfit and Stone was not going to be easy. Something had to give and it was not going to be the Smurfit part of the equation, so out goes Roger Stone and his son-in-law Matthew Kaplan, who headed Smurfit Stone's key corrugated container division.

Needless to say, the announcement of Roger Stone's retirement at the end of March contained the usual valedictories, with Michael Smurfit lauding his "outstanding contribution" and his "leadership", etc.

That announcement also signalled Matthew Kaplan's departure at the end of March, but omitted to mention that the departing head of Smurfit Stone's corrugated division was no other than Roger Stone's son-in-law. Seems that the Smurfit group isn't alone in the packaging world in having lots of the family running the business!

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With Ray Curran now in firm control as president and chief executive of Smurfit Stone, the big question facing the group - judging from the volume of correspondence on the bulletin board - is who takes over from Matthew Kaplan as head of the corrugated containerboard division. Most believe firmly that the successor will come from the Smurfit side of the merger, with most potential candidates from the Stone side seen as too closely linked to the Stones.

It is taken as read that the new chief operating officer who will report to Ray Curran will come from Smurfit, with a strong view in the industry that Mr Curran will only appoint somebody who he knows well and who he can trust to put through the rationalisation and asset disposals that are the key to the success of this merger.