Industry Reports

Deutsche Bank Reports Summaries

080505 Deutsche Bank Report - WY Deal Approved

Deutsche Bank - Equity Research

International Paper {Ticker: IP.N, Closing Price: USD 25.73, Target Price: USD 40.00, Recommendation: Buy}.

US regulators have given their approval to International Paper's acquisition of Weyerhaeuser's containerboard & corrugated operations. The approval has come quicker than we expected. At the same time, regulators have not asked for the sale of any assets as part of the approval. A number of observers had expected IP to have to sell assets as part of the approval. The deal still awaits approval in a number of offshore locations.

This should help bring the deal's closing into early 3Q. We think "sooner is better." The longer that Weyerhaeuser remains independent, the greater is the risk that they could destabilize the market by running to maintain volumes. When coupled with this weekend's tragic explosion of the recovery boiler at IP's Vicksburg, MS containerboard mill, the likelihood for an unwinding in the containerboard market looks remote.