Stamford, CO, January 18--MeadWestvaco Corp. has agreed to sell its papers business, including several mills and forest land, for $2.3 billion to a private buyout group so it can focus on its packaging business.
The buyer in the deal announced Tuesday is a new company controlled by Cerberus Capital Management LP, a private, New York-based investment firm. The deal requires regulatory approvals and financing.
The company’s Specialty Papers division manufactures papers used in the production of laminate flooring industry.
"This transaction marks an important strategic step for MeadWestvaco," said John A. Luke Jr., chairman and chief executive. "It makes us a more focused company, able to deliver stronger, more consistent financial returns."
Under the terms of the agreement, the new company will acquire MeadWestvaco's papers business, which consists primarily of mills located in Chillicothe, Ohio; Escanaba, Mich.; Luke, Md.; Rumford, Maine; and Wickliffe, Ky.
The mills have a combined annual capacity of approximately 2.05 million tons of coated paper, 290,000 tons of carbonless paper and 110,000 tons of uncoated paper.
