Report: Suzano preparing $15B bid for International Paper

A recent report claims Brazilian pulp and paper company Suzano has expressed interest in an all-cash acquisition of International Paper (IP) that would be worth nearly $15 billion.

According to a May 7 report from Reuters, Suzano verbally communicated its $42-per-share offer to IP’s board of directors, and sources tell Reuters the company could submit a formal bid in the coming days.

However, the sources also tell Reuters that IP is poised to reject Suzano’s offer as “inadequate.”

Memphis, Tennessee-based IP has declined to comment on the potential offer and says it is focused on completing its merger with DS Smith.

“The IP team, led by new CEO Andy Silvernail, is executing on business strategies and pursuing commercial and cost improvement initiatives across the portfolio to achieve best-in-class profit margins and significant earnings growth,” IP says in a statement.

“In addition, as industry conditions continue to improve, IP will come out of a cyclical bottom for earnings. The company is also focused on completing its previously announced combination with DS Smith, which offers a unique and highly compelling opportunity to create significant shareholder value above its base plan.”

Reuters reports that Suzano, the world's largest pulp manufacturer, is in talks to line up debt financing to support its bid, and its sources say the company has informed IP that the offer would be conditional on IP abandoning its deal with DS Smith.

A report from Investing.com says if Suzano’s $15 billion deal to take over IP goes through, it would be the largest-ever deal for the sector.