Potential Acquisition of Brazilian Pulp Producer Suzano by American International Paperia Raises Concerns in the Industry

The potential acquisition of Brazilian pulp producer Suzano by American International Paperia (IP) has raised questions among industry experts. According to a report by Reuters, Suzano approached IP with a $15 billion purchase offer, which is close to the company’s market value. While Suzano is the world’s largest pulp producer, IP focuses on North American corrugated cardboard and packaging.

Finnish forest companies UPM and Stora Enso operate in Europe, with minimal overlap between their businesses. If the deal were to go through, it would consolidate the global market but may not have revolutionary effects on Finnish companies. However, it could help Suzano diversify geographically and reduce its risk in China.

Despite these potential benefits, the rumored deal raises concerns due to the low synergy between Suzano and IP and the large scale of the arrangement for Suzano. The stock market did not react positively to the news, indicating skepticism about the deal. It remains uncertain whether the deal will go through or fall apart due to these concerns.

Antti Viljakainen, an analyst from Inderes, finds the deal unusual and questionable. He suggests that it may eventually fall through due to these concerns.