As ownership goes to SK Bangur, pages flip back for Andhra Pradesh Paper Mills

It was way back in March, 2011 that NYSE-listed International Paper announced its acquisition of 53.5 per cent stake in Andhra Pradesh Paper Mills for about ₹1,435 crore. The US-based company made further investments to acquire additional stakes through an open offer .

International Paper entered India when the paper industry was passing through a tough business cycle, but was holding immense growth potential. The company was hoping that the country’s economic growth would be on an upswing and paper demand was poised to go up.

International Paper was the first major global paper player to enter India through acquisition route. It bought stakes from LN Bangur, his family members and associates to get a controlling stake in Andhra Pradesh Paper Mills. It later acquired an additional 21.5 per cent stake for about ₹468 crore through a public offer, taking its total holding to 75 per cent.

Now, after about eight years, International Paper is selling its stake in Andhra Pradesh Paper Mills to West Coast Paper Mills, a listed entity promoted by SK Bangur.

Andhra Pradesh Paper Mills’ mother plant is located at Rajahmundry and the second plant is at Kadiam, both in Andhra Pradesh. The company had also invested in modernisation and upgrade. The company, which had been posting losses, is getting into profitability mode.

Meanwhile, an open offer for acquisition of 25 per cent in International Paper APPM (IP APPM) has been announced.

IP APPM has announced a share purchase agreement between International Paper Investments Holdings and West Coast Paper Mills for sale of minimum of 51 per cent and up to 60 per cent of the paid -up capital.

The shares of IP APPM are held by International Paper Investments (Luxembourg), SARL Luxembourg and International Holdings, USA.

International Paper has said that it plans to focus on other areas of business such as global packaging and cellulose fibres. The wheel turns full circle once the deal with West Coast Paper Mills gets completed.

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