TICONDEROGA – International Paper’s Ticonderoga Mill is part of the recently-announced spinoff into a new, standalone company.
The Printing Papers Division the mill is in will be owned by the new SpinCo and the move is expected to be finalized sometime in the third quarter of 2021.
No loss of jobs or closure of mills is anticipated due to the spinoff, IP representatives said.
“We believe the change will be smooth,” Ticonderoga Mill Communications Manager Donna Wadsworth said. “The mill is not closing. We’re doing fine.”
SpinCo will have 8 mills in the U.S., Brazil and Europe with 2.9 million metric tons of annual papermaking capacity and 0.4 million metric tons of coated paperboard production.
The transaction will distribute SpinCo shares to IP shareholders, with the company holding 19.99 percent of SpinCo shares to provide additional proceeds to International Paper.
Jean-Michel Ribieras, IP senior vice president for Industrial Packaging, will become the chief executive officer of SpinCo, and John Sims, now senior vice president for Corporate Development, will be the chief financial officer. SpinCo is a temporary name that will be changed once the deal is finalized.
The spinoff is subject to final approval by the IP Board of Directors, and approval of registration by the U.S. Securities and Exchange Commission, as well as a tax opinion from legal counsel.
The company said the move should be tax-free for shareholders for federal income tax purposes.
International Paper will now be solely a maker of corrugated packaging and absorbent cellulose-fiber products.
The transaction will create two streamlined companies, IP Chief Executive Officer/Chairman Mark Sutton said in a news release.
“I am confident our plans will create value for our shareholders, employees, customers and other stakeholders,” he said.
The new company will not pay a dividend at first, and IP will reduce its own dividend payments by 15 to 20 percent, the release said.
The Ticonderoga Mill remains strong, Wadsworth said.
“Things are going good here,” she said. “We’re making paper.”
The Ticonderoga Mill’s 615 employees manufacture color printing papers under the Hammermill, Accent and Springhill brands.