Global paper and packaging company International Paper (IP) and Temple-Inland in the US have reached an agreement with Antitrust Division of the US Department of Justice (DOJ) with respect to IP’s acquisition of Temple-Inland for $3.7bn.
IP said as part of the agreement, the DOJ has entered into a consent decree with the company and Temple-Inland that allows the combination to proceed. Under the terms of the consent decree filed in federal court in the District of Columbia, the combined company will undertake the post close divesture of 970,000t of containerboard mill capacity within four months.
The combined company, without the divestitures, would have had control of 37% of the North American capacity for containerboard, which is used to make corrugated boxes.
The company has agreed to divest Temple-Inland's facilities in Ontario, California and New Johnsonville, Tennessee, and IP's facility in Hueneme, California.
IP hopes to achieve at least $300m of synergies within twenty-four months of closing. The company has manufacturing operations in North America, Europe, Latin America, Russia, Asia and North Africa and its businesses include uncoated papers and industrial and consumer packaging.
Temple-Inland focuses on corrugated packaging and building products and the fully integrated corrugated packaging operation consists of seven mills and 59 converting facilities.
