Norske to Acquire Fletcher Challenge's Paper Group

Norske Skog ASA has bought Fletcher Challenge Ltd's paper division, according to a statement released Monday by Fletcher Challenge.

Under the agreement, Norske will pay cash for all the shares of Fletcher, and also make a payment to Fletcher Challenge, which will be used to repay all outstanding Fletcher Paper debts at the close of the transaction.

The Norske Skog purchase includes Fletcher's pulp and paper operations in Australia, New Zealand, Asia, South America and Canada.

Norske is an international pulp and paper group with production facilities in Norway, France, Austria, the Czech Republic, Thailand, South Korea and China, and operations in Brazil through its partnership with Klabin Papel e Celulose S.A.

Following the acquisition of Fletcher Paper, Norske will become the second largest newsprint manufacturer in the world with total annual production capacity of 5.1 million metric tons of newsprint.

The transaction is expected to close in July, Fletcher said in the statement.