Shares of International Paper Co. shot up 5.0% toward a more-than 2-year high in premarket trading Thursday, after the packaging, pulp and paper company announced a plan to spin off its printing papers business into a standalone, publicly traded company. The spinoff is expected to be completed in the third quarter of 2021. The spinoff, dubbed SpinCo for now, plans to raise debt to pay a dividend to International Paper, which will be used to pay down debt. SpinCo will have about $4 billion in sales. The spinoff is part of International Paper’s plan to cut costs and accelerate earnings. The company expects to generate additional earnings of $350 million to $400 million a year by the end or 2023, including $50 million to $100 million in earnings growth and $300 million in cost cuts. The stock, which is on track to open at the highest price seen during regular-session hours since September 2018, has gained 8.3% year to date through Wednesday, while the S&P 500 has advanced 13.6%.
Microsoft may earn an Affiliate Commission if you purchase something through recommended links in this article.
Send MSN Feedback
Please give an overall site rating:
Opens in a new window
Opens an external site
Opens an external site in a new window