- Update 5:33pm: Adds potential value of transaction.
- Domtar (NYSE:UFS) rose 17% in after hours trading on a report that Canada's Paper Excellence is exploring a potential bid for the company.
- The companies are using advisers on possible deal, accoring to a Bloomberg report. A deal may value Domtar in the mid-$50s/share. There's no certainty a transaction will occur.
- The report comes as Domtar has been speculated in recent months as a takeover target. A report in February said that some changes in its severance plan may mean the company is preparing for a sale. Domtar gained in late January when CEO John Williams was on temporary medical leave, leading to speculation of a potential sale.
- In January, RBC predicted consolidation this year in the packaging and paper sector and saw Packaging Corp. (NYSE:PKG) or Westrock (NYSE:WRK) as potential buyers of Domtar.
- In March, Domtar closed the sale of its personal care business.
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