Clearwater buys Cellu Tissue, creates company with 14 plants
Clearwater Paper Corp. Monday closed on its $530 million acquisition of Cellu Tissue Holdings Inc.
The deal creates a company with 14 manufacturing plants in the United States and Canada and annual sales of $1.9 billion. A 15th plant is under construction in Shelby, N.C.
Cellu Tissue is headquartered in Alpharetta, Ga.
Chief Executive Officer Gordon Jones said the deal will allow Spokane-based Clearwater to expand production of its private-label tissue products, and to diversify into new sales channels.
The combined companies will employ 3,700.
“We are ready to put the combined talents of all of our employees into action to best support Clearwater Paper’s existing and new customers,” Vice President Bob DeVleming said.
Clearwater paid $12 per share for Cellu Tissue stock, retired $267 million in debt, and assumed another $16 million in debt. The company on Monday completed its cash tender offer for Cellu Tissue notes due in 2014, with $234.5 million tendered.
Clearwater financed the acquisition with cash and $375 million in debt financing.
“It’s been a big year for us,” said spokesman Matt Van Vleet, referring to the purchase and the start of construction on the $260 million Shelby plant.
Clearwater stock, which opened the year at $55, has traded near or above $80 per share since the Cellu Tissue deal was announced. Shares closed Monday at $79.08.