Each issue of PaperMoney is approximately 500 fact filled pages.
Logout
Click here for Pulp & Paper Radio International
The Paperitalo Library
Free Downloads
Search
My Profile
Login
Management Side
International Paper Agrees to Sell Kraft Papers to Stone Arcade Acquisition Corp.
Print
Stamford, Connecticut, USA, 26 June 2006 -- /PRNewswire/ -- International Paper (NYSE:IP) has signed a definitive agreement to sell its kraft papers business to Stone Arcade Acquisition Corp. (BULLETIN BOARD: SCDE) for approximately USD 155 million in cash, subject to certain closing and post-closing adjustments, and two payments totaling up to USD 60 million, payable five years from the close of the transaction, contingent upon business performance.

The kraft papers business generated approximately USD 220 million in sales in 2005 and includes the Roanoke Rapids, North Carolina, paper mill and the Ride Rite(R) dunnage bag plant in Fordyce, Arkansas.

The agreement is part of IP's previously announced transformation plan to focus on uncoated papers and packaging. Proceeds from divestitures announced to date, including kraft papers, total approximately USD 9.3 billion.

The sale is expected to close in the third quarter, subject to satisfaction of various closing conditions, including regulatory approval and approval by Stone Arcade shareholders. After closing, the company will be called KapStone Kraft Paper Corporation -- a division of KapStone Paper and Packaging Corporation. Tim Keneally, currently vice president of IP's kraft papers business, will lead the KapStone Kraft Paper business.

"Kraft Papers has been a solid niche business for International Paper and we're pleased to see that a number of interested parties, including Stone Arcade, agree with us," said Carol Roberts, senior vice president of IP Packaging Solutions. "This agreement speaks to the quality of the people and the assets of this business."

"The acquisition of IP's kraft papers business is an important first step for our company, Stone Arcade," said Roger Stone, chairman and CEO of Stone Arcade. "It provides us with a very solid platform from which we hope to expand. We look forward to working with the current management group to develop internal growth opportunities while we simultaneously explore strategic acquisitions."

International Paper's kraft papers business produces approximately 400,000 tons of kraft papers, used in a variety of end-use products, including approximately 9 million Ride Rite(R) dunnage bags. The business employs approximately 700 people. International Paper accounted for the results of its kraft papers business as a discontinued operation and wrote down the business' assets in the first quarter of 2006.

Stone Arcade Acquisition Corporation is a publicly traded special purpose acquisition company founded in August 2005. Stone Arcade was formed for the purpose of identifying and effecting an asset acquisition or business combination with an unidentified business in the paper, packaging, forest products, and related industries.

Headquartered in the United States, International Paper has been a leader in the forest products industry for more than 100 years. The company is currently transforming its operations to focus on its global uncoated papers and packaging businesses, which operate and serve customers in the United States, Europe, South America, and Asia. These businesses are complemented by an extensive North American merchant distribution system. International Paper is committed to environmental, economic, and social sustainability, and has a long-standing policy of using no wood from endangered forests. To learn more, visit www.internationalpaper.com.



Powered by Bondware
News Publishing Software

The browser you are using is outdated!

You may not be getting all you can out of your browsing experience
and may be open to security risks!

Consider upgrading to the latest version of your browser or choose on below: