SÃo Paulo -Suzano, the world’s largest pulp producer, has announced the purchase of industrial assets from Pactiv Evergreen in the United States.
This will allow the company to extend its operations in North America and enter the consumer and food service packaging segments of the region. The acquisition is for US$110 million and comprises two mills in Pine Bluff, Arkansas, and Waynesville, North Carolina, which produce liquid packaging board and cupstock.
Subject to final regulatory approval later this year, these assets will increase Suzano’s manufacturing capacity by about 420,000 metric tons of integrated paperboard per year. Along with the transaction, Suzano negotiated a long-term supply agreement with Pactiv Evergreen to offer liquid packaging board for its conversion business.
Suzano is currently North America’s largest producer of hardwood market pulp, with US operations in Fort Lauderdale, Florida and a research and innovation site near Vancouver, Canada. Suzano, a major producer of materials for food and beverage packaging in Latin America.
Will collaborate with Pactiv Evergreen’s team leveraging its operational knowledge and experience in the paperboard business to improve the structural competitiveness and profitability of the acquired assets, which are already comparatively well-positioned on the North American packaging cost curve.
Fabio Almeida, Executive Vice President of Paper and Packaging at Suzano, said:
“This acquisition is in line with our strategy. We are entering the North American market as a competitive producer of paperboard, taking on quality assets that are strategically well-located from an operational and logistical perspective, and opening new opportunities for growth.”
“As a business with 100 years of history behind us, we see this deal as an investment into our future and we look forward to building a long-lasting and positive relationship with the teams at Pine Bluff and Waynesville, as well as the local communities around both facilities.”
The purchased assets benefit from the region’s abundant supply of wood, low energy costs, and convenient access to railways, ports, and highways. The transaction is subject to normal conditions, including clearance by a foreign antitrust regulator.
Once approved, the asset acquisition will take place at closure, with the price subject to standard economic and operational adjustments for this sort of transaction. The agreed-upon value has no meaningful influence on Suzano’s financial leverage or debt levels.
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