International Paper Company
), a global paper and packaging firm, has recently acquired the
majority stake in Olmuksa, a Turkish corrugated packaging
company, for approximately $56 million. The company purchased all
the shares of its joint venture partner Sabanci Holding in
Olmuksa to own 87.5% of its total outstanding shares.
Going forward, the company is likely to float a mandatory
tender offer for the remainder of shares (approximately 12.5%) in
accordance to the rules and regulations of the Turkish Capital
With the acquisition, International Paper has strengthened its
presence in Turkey to leverage its strategic positioning to drive
future growth in the Middle East region. In addition, the Turkish
corrugated market in itself is quite attractive - currently being
the 7th largest in Europe with an expected annual growth rate of
over 5%. Consequently, the deal is anticipated to fuel its growth
engine across geographical borders.
International Paper has historically followed an inorganic growth
strategy to extend its operations. The company acquired
Temple-Inland Inc. in February 2012 and the corrugated packaging
) in August 2008.
International Paper expects the acquisition of Temple-Inland
to yield synergies of $400 million by the end of 2013, derived
largely from operations, freight, logistics, selling expense and
overheads. Moreover, the combination is likely to fortify the
packaging business of North America by increasing its share in
the corrugated packaging market to 34% from the existing level of
CLEAR CHANL OUT (CCO): Free Stock Analysis
INTL PAPER (IP): Free Stock Analysis Report
WEYERHAEUSER CO (WY): Free Stock Analysis
To read this article on Zacks.com click here.
Headquartered in Memphis, Tennessee, International Paper has
manufacturing operations in North America, Europe, Latin America,
Russia, Asia and North Africa. The company's businesses include
uncoated papers and industrial and consumer packaging. Employing
approximately 70,000 people, International Paper has a strategic
presence in more than 24 countries serving customers worldwide.
We have a Neutral recommendation on International Paper, which
currently has a Zacks #2 Rank (Buy). We also have a Neutral
recommendation and a Zacks #3 Rank (Hold) for
), one of the competitors of International Paper.