IP to convert newsprint mill for recycled containerboard production

SPOKANE (Scrap Monster): International Paper has signed an agreement with forest industry group Holmen to buy Holmen’s newsprint mill in Madrid. The mill will be converted for recycled containerboard production. The transaction is expected to close during the second quarter of the current year, but is subject to regulatory approvals, International Paper noted.

According to Henrik Sjölund, Holmen CEO and President, the transaction is part of its ongoing efforts to focus on development of speciality paper strategy at its Swedish mills. The sale of the Madrid mill will help the company’s printing paper operations to deliver good profits going forward.

International Paper will continue production of newsprint paper until the second half of next year. Towards the end of next year, the mill will be converted into containerboard. International Paper noted that the Spanish mill purchase will boost the growth of its corrugated packaging business in EMEA. The company’s total investment in the project is estimated at nearly Euro 150 million.

The agreement also covers Holmen’s energy and recycled paper operations at the facility. The sale transaction also includes Holmen’s 50% shareholding in the energy producer Peninsular Cogeneración S.A. and the recycled paper collector Cartón y Papel Reciclado S.A. (Carpa).

Holmen is a Swedish company which bases its business in the forest industry and the pulp and paper industry. Holmen's main products are paperboard for consumer packaging and graphical applications.

International Paper is a global leader in the paper and packaging industry with manufacturing operations in North America, Europe, Latin America, Asia and North Africa. Headquartered in Memphis, Tenn., the company employs approximately 65,000 people and is strategically located in more than 24 countries serving customers worldwide.