International Paper Company
) purchased 25% remaining stake in its Brazilian joint venture,
Orsa International Paper Embalagens S.A., from its collaboration
partner for $135 million.
With this transaction, International Paper will now be in
complete charge of partner Jari Cellulose's former corrugated
packaging assets, comprising of three containerboard mills and
four box plants. The original transaction, in which International
Paper had purchased a 75% stake, was finalized in Nov 2012, for
an aggregate purchase price of $470 million. The purchase
consideration for the 25% state is in line with the original
The transaction strengthens International Paper's focus on
growing its lucrative industrial packaging business into
unexplored, profitable markets. The company has been a dominant
player in the printing papers business in Brazil for over half a
century. The company's Brazilian operations include brands like
Chamex, Chamequinho and Chambril.
The company has undergone restructuring over the past eight years
to discard its non-core operations and develop its traditional
industrial packaging businesses. The process has included
offloading of over $11 billion worth of timberland and other
non-core businesses. Meanwhile, it has expanded its market share
in the industrial packaging segment by way of strategic
) packaging division in early 2008 and Temple-Inland in 2012.
In January, the company announced the spin-off of its struggling
xpedx distribution business in order to further streamline its
operations and generate economic profits. The spin-off was a part
of its strategy to increase focus on its legacy business of
industrial and consumer packaging and printing papers segments.
International Paper currently holds a Zacks Rank #3 (Hold). Other
better-ranked stocks in the paper & related products industry
that are worth a look include
Neenah Paper, Inc.
), both of which carry a Zacks Rank #1 (Strong Buy).
INTL PAPER (IP): Free Stock Analysis Report
NEENAH PAPER (NP): Free Stock Analysis Report
DOMTAR CORP (UFS): Free Stock Analysis Report
WEYERHAEUSER CO (WY): Free Stock Analysis
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