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IP Buys Weyerhaeuser Pulp Assets in $2.2B Deal


International Paper ( (IP) ) said Monday it would acquire the pulp business of Weyerhaeuser ( (WY) ) in a $2.2 billion deal that would add additional scale to what is already the world's largest paper products company.

Terms of the deal call for Memphis-based International Paper to acquire five pulp mills and two converting facilities that produce fluff pulp, softwood pulp and specialty pulp for a diapers, tissues, textiles and other hygiene products. The operation has nearly 1.9 million metric tons of capacity. IP's stock rose 0.89% in Tuesday morning trading, to $43.66, while Weyerhaeuser's climbed 0.87%, to $32.40.

This is International Paper's largest transaction since its $4.3 billion purchase of Temple-Inland Inc. in 2011. The company in a statement said that the assets and about 1,900 employees in the U.S., Canada and Poland will give IP a more global footprint that is better able to respond to shifts in demand.

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"Weyerhaeuser's pulp business has an outstanding customer base...