A Suzano is evaluating options for an expansion in the US that include the acquisition of a paper manufacturing business owned by billionaire Robert Kraft’s holding company, according to a Bloomberg report from people familiar with the matter.
The largest cellulose producer in the world evaluates the Rand-Whitneya company with paper and packaging assets controlled by Kraft Groupthe people said, asking not to be identified because the discussions are private.
While it’s unclear whether Suzano is considering a bid, its interest in Kraft’s assets underscores that the commodities giant controlled by the billionaire Brazilian Feffer family is actively looking for smaller paper companies in the U.S. as an alternative to its failed attempt to buy the International Paper earlier this year.
Suzano and Kraft did not comment.
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Sector and market diversification
Suzano dominates the production of wood pulp, an essential raw material in tissues and writing paper, imported mainly from China, and is interested in diversifying its operations into the more stable packaging sector and North America.
Earlier this year, the company approached International Paper with an offer, but backed away after failing to attract the $16.5 billion giant into negotiations.
The paper and packaging businesses controlled by the Kraft Group — which also include International Forest Products ea New-Indy Containerboard — would fit into a category of smaller deals that Suzano is now ready to pursue, according to the people. The companies, which operate paper mills spanning North Carolina to Indiana and New England, produce and sell a total of 4 million metric tons of paper annually, according to information on the holding company’s website.
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An acquisition in the USA could also mean a debut for Suzano in the corrugated cardboard packaging segment. The company’s packaging efforts so far have been limited to smaller markets, such as cardboard, which is the type most often used in cereal boxes.
The Kraft Group has companies in everything from real estate to sports. His most high-profile deal is the New England Patriots, the NFL franchise that has won six Super Bowls over the past two decades, with Tom Brady as its biggest star.
In June, Suzano agreed to buy Pactiv Evergreen’s Pine Bluff plant in Arkansas as part of a $110 million deal. The acquisition would create a base from which Suzano could expand “both organically and inorganically” in the US, Chief Financial Officer Marcelo Feriozzi Bacci said at the time.
