International Paper finalizes purchase of Weyerhaeuser's
International Paper has completed the purchase of the
assets of Weyerhaeuser's Containerboard, Packaging and
Recycling business for approximately $6 billion in cash,
subject to post-closing adjustments.
Because the transaction is a purchase of assets rather
than of stock, International Paper will realize a tax
benefit that has an estimated net present value of approximately
Carol Roberts, senior vice president of International Paper’s
packaging business, said she sees considerable upside potential
in the acquisition.
“Weyerhaeuser has low-cost, well-run assets that complement our
existing mill and converting system and offer significant synergies,”
International Paper has identified profit improvement opportunities
of about $400 million annually from the acquisition, as a result
of reducing duplicate overhead costs, integrating manufacturing
operations, optimizing product mix, and improving operational
and supply chain efficiencies. The company expects to achieve
at least 40 percent of the improvement within 12 months of completing
the transaction. The remainder is expected to be fully realized
by the end of the third year.