Bloomberg News

International Paper Sees Temple-Inland Approval by Feb. 13

February 02, 2012

(Updates with closing share prices in fifth paragraph.)

Feb. 2 (Bloomberg) -- International Paper Co., the world’s largest maker of corrugated packaging, said it expects to get antitrust approval for its proposed $3.7 billion acquisition of Temple-Inland Inc. before a Feb. 13 deadline.

The companies said Jan. 27 they agreed to extend the Department of Justice’s review of the deal to allow them time to submit documentation, the second time the deadline has been pushed back. The deal was announced Sept. 6 and if completed would be Memphis-based International Paper’s biggest in more than three years, according to data compiled by Bloomberg.

“We don’t anticipate it will need to be extended beyond that and the merger agreement calls for closing within two days of getting regulatory agreement,” Chairman and Chief Executive Officer John Faraci said today in a telephone interview.

International Paper proposes paying $32 a share for Austin, Texas-based Temple-Inland, a maker of corrugated shipping boxes. The deal would increase International Paper’s share of the North American cardboard-packaging market to about 37 percent from 27 percent, Faraci said in June.

Temple-Inland rose less than 0.1 percent to $31.91 at the close in New York. International Paper increased 0.7 percent to $31.60.

Faraci said in September that regulatory approval was expected by the end of 2011. The U.S. government may force International Paper to divest assets as a condition of its approval, Mark Wilde, a New York-based analyst for Deutsche Bank AG, said in a Jan. 23 note.

Profit Falls

“A lot of things are going on in Washington these days, so maybe we weren’t the first in the inbox,” Faraci said today. “I wouldn’t read anything into that.”

Fourth-quarter net income fell 19 percent to $257 million, or 59 cents a share, from $316 million, or 73 cents, a year earlier, International Paper said today in a statement. Profit excluding restructuring expenses and other one-time items was 66 cents a share, more than the 61-cent average of 12 analysts’ estimates compiled by Bloomberg. Sales dropped 2.5 percent to $6.37 billion from $6.53 billion.

--Editors: Simon Casey, Steven Frank

To contact the reporter on this story: Christopher Donville in Vancouver at cjdonville@bloomberg.net

To contact the editor responsible for this story: Simon Casey at scasey4@bloomberg.net


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