International Paper Co. said Tuesday that it is buying a majority stake of Andhra Pradesh Paper Mills Ltd. for about $257 million in cash in a deal that will help it expand in India.
The paper and packaging company is purchasing approximately 53.5 percent of Andhra's outstanding stock from L.N. Bangur and related family members and affiliates. It will also make a $62 million non-compete payment. Bangur is executive chairman of the Bangur Group.
As part of the deal, International Paper will start a public tender offer to buy up to an additional 21.5 percent of Andhra's outstanding stock for about $104 million in cash.
The stock purchase and tender offer and expected to close as early as the third quarter.
International Paper also said on Tuesday that it is raising its quarterly dividend to 26.25 cents per share from 18.75 cents per share. The paper and packaging company said this is its third dividend increase in the past year.
Last month International Paper reported a fourth-quarter profit that topped Wall Street's expectations.
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