International Paper today said that it has reached an agreement to sell its Temple-Inland Building Products division to Georgia-Pacific LLC for $750 million in cash, subject to certain pre-and post-closing adjustments.
The assets to be sold include 16 manufacturing facilities — five solid wood mills, four particleboard plants, two medium-density fiberboard plants, one fiberboard plant and four gypsum wallboard plants.
"While not core to IP's strategy, Temple-Inland Building Products is an industry leader," said John Faraci, Chairman and Chief Executive Officer. "I am pleased to have reached a deal that recognizes the strength of the business and provides excellent value for IP shareowners."
Temple-Inland Building Products facilities are located across eight states, primarily in the southeastern and eastern portions of the United States, with access to five of the top 12 housing markets.
Georgia-Pacific's CEO and President, Jim Hannan, said, "This acquisition is a long-term investment that will create value for our customers and our company. These high-quality assets with teams of talented employees are strategically located near large, growing regions of building products customers and will fit well into our existing operations. This will allow us to expand our geographic footprint and enhance our service to new and existing customers."
IP said that it intends to use the proceeds from the sale to reduce its debt.
IP and G-P expect the deal to be completed in the first quarter of 2013, subject to satisfaction of various closing conditions, including obtaining required governmental approvals.
