BRASILIA (dpa-AFX) - Kimberly-Clark Corp. (KMB) announced Thursday that it has entered into an agreement with Brazil's Suzano S.A. (SUZ) to form a strategic partnership, creating a preeminent international tissue and professional products company.
This will enable Kimberly-Clark to sharpen focus on its higher growth, higher margin International Personal Care and North America Tissue and Professional businesses.
Following the completion of the transaction, Kimberly-Clark will reduce its exposure to more volatile input costs, enhancing its ability to deliver more predictable and consistent margins and profit growth over time.
Kimberly-Clark will own a 49% interest in the new venture, which will include substantially all the assets of its International Family Care and Professional (IFP) business, and Suzano will own 51%.
Kimberly-Clark will contribute substantially all the assets of its IFP business to the venture. IFP's more than 40 regional brands will be owned by the new entity and its five global brands, including Scott, Kleenex, Viva, WypAll and Kimberly-Clark Professional, will be licensed to the venture.
The business Kimberly-Clark is contributing to the venture generated approximately $3.3 billion of net sales in 2024.
Kimberly-Clark's interests in Mexico and its joint venture in South Korea are outside the scope of this transaction.
The Company noted that, upon closing, the transaction is expected to be approximately $0.30 to 0.40 to adjusted earnings per share in the first full year following close. It expects to classify the IFP businesses included in the transaction as discontinued operations within its financial disclosures beginning with its second quarter earnings results.
The transaction is not subject to any financing contingency. Suzano will have the option to purchase Kimberly-Clark's remaining 49% ownership interest under an agreed valuation framework.
The transaction is subject to the satisfaction of customary consultation requirements and closing conditions, including obtaining required regulatory approvals. The transaction, unanimously approved by Kimberly-Clark's Board of Directors, is expected to close in mid-2026.
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