Domtar Corporation is selling its diaper and adult incontinence business for $920 million U.S., nearly a decade after adding the new line of products to offset declining paper sales.
The Montreal and South Carolina-based pulp and paper company says it has signed an agreement to sell the operations to the private equity firm American Industrial Partners.
Domtar CEO John Williams says it follows a decision announced last August to conduct a review of “value-creating alternatives” for the personal care business it launched in 2012 with the purchase of Attends.
The sale is part of Domtar’s transformation towards packaging and will reduce debt by $600 million U.S. and repurchase $300 million U.S. in shares.
Williams says the Kingsport, Tennessee mill will be retrofit to house a lightweight containerboard facility producing about 600,000 tons of recycled linerboard and corrugated material.
Reconstruction is expected to be complete by the end of 2022.