Advances Transformation into a Premier
Independent Supplier of Paperboard to North American Converters
Transaction to Accelerate Ongoing Efforts to
De-Lever the Balance Sheet by Meaningfully Reducing Net Debt
Clearwater Paper Corporation (NYSE: CLW) (“Clearwater Paper” or
the “Company”), a premier supplier of quality consumer tissue and
bleached paperboard, today announced that it has entered into a
definitive agreement to sell its tissue business to Sofidel America
Corporation, a subsidiary of Sofidel S.p.A. (“Sofidel”), a leading
manufacturer of paper for hygienic and domestic use, for $1.06
billion, subject to adjustments for debt, cash, transaction
expenses and net working capital. The transaction represents the
next step in the Company’s transformation to become a premier
independent supplier of paperboard to North American converters and
the conclusion of its previously announced review of strategic
options for the tissue business.
“We are pleased to have reached this agreement with Sofidel,
which we believe positions Clearwater Paper for its next chapter of
growth and value creation,” said Arsen Kitch, President and Chief
Executive Officer. “Clearwater Paper is transforming into a premier
paper supplier in North America. Upon completion of this
transaction, we intend to deleverage our balance sheet while
scaling and diversifying our paperboard business to meet the needs
of our customers. We look forward to delivering innovative and
sustainable products to our converter customers while generating
strong returns for our shareholders.”
Mr. Kitch continued, “Our tissue business has delivered
excellent financial and operational performance, supported by
outstanding service. We believe this business needs scale and
investment to drive growth over the longer term, and we are excited
to watch its continued progress as part of Sofidel. We appreciate
the dedication of our talented team members across the
organization, who have been instrumental to the successful
execution of our strategy.”
“The acquisition of Clearwater Paper’s tissue business is
another important milestone on our path to meet the growing demand
for our products in the United States,” said Luigi Lazzareschi,
Chief Executive Officer of Sofidel. “We look forward to welcoming
all the new employees into our family and integrating the tissue
business into our network to strengthen our growth by achieving
scale and expanding our ability to deliver sustainable, energy
efficient products to customers.”
Transaction Details
The $1.06 billion price represents a multiple of approximately
six times the Adjusted EBITDA of Clearwater Paper’s tissue segment
during the twelve months ending March 31, 2024. The Company expects
net proceeds from the transaction of approximately $850 million,
which it intends to use to meaningfully delever its balance sheet
and invest in growth initiatives for its continuing operations.
The transaction is expected to close in the latter part of 2024,
subject to customary closing conditions, including the expiration
or termination of the waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976.
Goldman Sachs & Co. LLC is serving as financial advisor to
Clearwater Paper, and Pillsbury Winthrop Shaw Pittman LLP is
serving as legal advisor.
Availability and Timing of Second Quarter 2024 Earnings
Results
In a separate release issued today, the Company announced that
it will release its second quarter 2024 results on Tuesday, August
6, 2024. Mr. Kitch and Chief Financial Officer Sherri Baker will
discuss the results during a conference call that day at 2 p.m.
Pacific Time. Additional information on this event can be accessed
at Clearwater Paper’s website: http://ir.clearwaterpaper.com.
ABOUT CLEARWATER PAPER
Clearwater Paper is a premier supplier of private brand tissue
to major retailers, including grocery, club, mass merchants, and
discount stores. In addition, the company produces paperboard used
by quality-conscious printers and packaging converters, and offers
services that include custom sheeting, slitting, and cutting.
Clearwater Paper's employees build shareholder value by developing
strong relationships through quality and service. For more
information on Clearwater Paper, please visit our website at
www.clearwaterpaper.com.
FORWARD-LOOKING STATEMENTS
This press release contains certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995, as amended, including statements regarding the expected
timing and structure of the proposed transaction; the ability of
the parties to complete the proposed transaction considering the
various closing conditions; the company’s paperboard strategy,
including its plans to further scale and increase capacity
utilization; the company’s plans for the proceeds from the
transaction, including its plan to meaningfully de-lever its
balance sheet; and the company’s expectation that paperboard
represents the best opportunity for steady and sustainable value
creation. Forward-looking statements concern future circumstances
and results and other statements that are not historical facts and
are sometimes identified by the words "may," "will," "should,"
"potential," "intend," "expect,", "endeavor," "seek," "anticipate,"
"estimate," "overestimate," "underestimate," "believe," "could,"
"project," "predict," "continue," "target" or other similar words
or expressions. Forward-looking statements are based upon current
plans, estimates and expectations that are subject to risks,
uncertainties and assumptions. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those indicated
or anticipated by such forward-looking statements. The inclusion of
such statements should not be regarded as a representation that
such plans, estimates or expectations will be achieved. Important
factors that could cause actual results to differ materially from
such plans, estimates or expectations include, among others, (1)
that one or more closing conditions to the transaction, including
certain regulatory approvals, may not be satisfied or waived, on a
timely basis or otherwise; (2) the risk that the proposed
transaction may not be completed in the time frame expected by the
parties, or at all; (3) unexpected costs, charges or expenses
resulting from the proposed transaction; (4) the risk that
stockholder litigation in connection with the proposed transaction
or other settlements or investigations may affect the timing or
occurrence of the contemplated transaction or result in significant
costs of defense, indemnification and liability; and (5) other risk
factors as detailed from time to time in the company’s reports
filed with the SEC, including its Annual Report on Form 10-K,
periodic quarterly reports on Form 10-Q, periodic current reports
on Form 8-K and other documents filed with the SEC. The foregoing
list of important factors is not exclusive. Undue reliance should
not be placed on such forward-looking statements, as such
statements speak only as of the date on which they are made and the
company does not undertake any obligation to update such
statements, except as may be required by law.
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version on businesswire.com: https://www.businesswire.com/news/home/20240719333892/en/
Investor contact: Sloan Bohlen Solebury Strategic
Communications 509.344.5906 investorinfo@clearwaterpaper.com
Media contact: Matt Van Vleet Clearwater Paper
Corporation 509.344.7117 matt.vanvleet@clearwaterpaper.com
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