A three-part transformation plan will narrow International Paper's portfolio to two key platform businesses: Uncoated Papers and Industrial and Consumer Packaging. The company is the world leader in uncoated paper with 6.6Mt of capacity and 2004 sales of approximately $5.8 billion. The global packaging business includes 6.7Mt of manufacturing capacity for containerboard and coated board, and 128 converting locations in the US, Latin America, Europe and Asia.
IP will "evaluate strategic options" for its other businesses, including the potential sale or spin-off of its 50.5 per cent stake in Carter Holt Harvey, Australasia's largest forest products company, Coated and Supercalendered Papers, Beverage Packaging, Kraft Papers, and potentially all of its 6.8M acres of US forestlands.
"We already have a strong global position in uncoated paper and a growing worldwide platform in packaging," says chairman and ceo John Faraci. "Our portfolio changes will allow us to better focus management attention and financial resources on these key businesses, which represent over 70 per cent of our sales.
"Our US corrugated container and containerboard business is earning the right to grow, and the changes planned will further strengthen this business," he continues. "We have strengthened our US industrial packaging business through the acquisition of Box USA, and we have a strong European box business. We are a top producer of coated board, and we have advantages in terms of cost and customer base with a solid consumer packaging franchise."
The transformation plan is designed to improve IP's overall profitability and lead to average annual cost savings of about $400M over the coming years.
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| International Paper Tel: +1 203 541 8541 |
