Paper and pulp firm International Paper Co. (IP) agreed to merge
its distribution services business, xpedx, with distribution
company Unisource Worldwide Inc., seeking to create a new publicly
traded company.
International Paper will receive a $400 million cash payment as
part of the transaction and it will distribute shares of the new
company to existing shareholders. IP shareholders will own 51% of
the new venture and Unisource's owner will own 49%. The merger is
expected to close in mid-2014.
The new company will have projected annual revenue of $9 billion
to $10 billion and will have about 9,500 employees across more than
170 distribution centers in North America.
Mary Laschinger, president of xpedx, will be chief executive and
chairman of the new company. Allan Dragone, currently president and
CEO of Unisource Worldwide, will serve as a director of the new
company and will advise on integration activities.
Unisource Worldwide distributes and markets more than 150,000
national and private-label products, including commercial printing
and business imaging papers, facility supplies and equipment, and
packaging materials and equipment in North America. Unisource is
owned by holding company UWW Holdings LLC, which is owned by an
affiliate of Bain Capital and by Koch Industries Inc.'s
Georgia-Pacific, and some affiliates.
IP shares closed Monday at $45.74 and were up 0.6% premarket.
The stock is up 1.5% in the past three months.
Write to Ben Fox Rubin at ben.rubin@wsj.com
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