US-based pulp and paper company International Paper (IP) has reached two agreements to sell three US containerboard mills for $470m in connection with the company's acquisition of Temple-Inland for $3.5bn.
According to IP, the move aims to satisfy the company's obligations in its February 2012 settlement agreement with the US Department of Justice (DOJ).
Under the terms of the agreement, IP agreed to divest its Temple-Inland mill in Ontario, Canada, the former Temple-Inland mill in New Johnsonville, Tennessee and the IP mill in Oxnard (Hueneme), California.
IP will sell the New Johnsonville mill to Hood Companies, and the Ontario and Hueneme mills to New-Indy Containerboard, a newly formed joint venture of The Kraft Group, and Schwarz Partners.
IP chairman and CEO John Faraci said the company has reached the agreements within the timeline established in its settlement with the DOJ.
"The purchasers are experienced operators in the paper, forest products and packaging industries, and we look forward to working with them to close these transactions in a timely manner," Faraci added.
IP said each divestiture is subject to certain closing conditions, including DOJ approval and must be closed within the time periods prescribed by the agreement.
