International Paper Sells Beverage Packaging, Arizona Chemical Businesses For $985 million

Beverage packaging goes to Carter Holt Harvey for $500 million; Arizona Chemical goes to Rhone Capital for $485 million.

International Paper announced Tuesday the sale of its beverage packaging and Arizona Chemical businesses for approximately $985 million.

International Paper will sell its beverage packaging business to Carter Holt Harvey, Ltd., an Australasia forest products company, for nearly $500 million, and its Arizona Chemical business to Rhone Capital III L.P. for approximately $485 million.

The beverage packaging business includes gable-top beverage converting facilities in Massachusetts, Michigan, North Carolina, Florida, California, and Ontario and Quebec, Canada; the Evergreen Packaging manufacturing facility in Iowa, and the Pine Bluff mill in Arkansas. The business also has wholly owned subsidiaries in China, South Korea and Taiwan, and joint ventures in Latin America, Israel, and Saudi Arabia.

The business has about 3,000 employees and produces more than 680,000 tons per year of packaging for juice, dairy and other products, and coated groundwood paper. The business had net sales of about $860 million in 2005.

Arizona Chemical, a supplier of pine chemicals to the adhesives, inks and coatings, and oleochemicals markets, is headquartered in Jacksonville, Fla. and has 11 global manufacturing facilities.

Rhone Capital specializes in mid-market leveraged buyouts, recapitalizations and partnerships with particular focus on European and Trans-Atlantic investments.

The transactions are subject to certain adjustments and conditions at closing, including receipt of regulatory approvals.

The agreements are part of International Paper's transformation plan. Proceeds from all transformation-related divestitures announced to date, including beverage packaging and Arizona Chemical, total approximately $11 billion.

More in Supply Chain