CHINA - International Paper is exiting its coated board joint venture in China, selling its 55% stake to partner Shandong Sun Holding Group Co Ltd for US$23 million (RMB 149 million) cash, and will focus on growing its corrugated box business in China and Southeast Asia instead.
Following completion of the transaction, International Paper will also remove approximately US$400 million of outstanding debt and other assets and liabilities from the balance sheet of the IP-Sun joint venture.
International Paper estimates the agreement to sell the Chinese coated board joint venture, which started in 2006, to Shandong Sun will result in net pre-tax noncash asset write-offs of approximately US$200 million to be recorded in the third quarter of 2015. The IP-Sun JV transaction is expected to complete within the next six months, subject to satisfaction of closing conditions, including obtaining required Chinese governmental approvals.
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