Should You Buy It? Scrap International Paper

International Paper(IP Quote) bought Weyerhaeuser's (WY Quote) containerboard and packaging businesses Monday for $6 billion. But given the 13% decline in the stock -- which closed Wednesday at $27.44 -- since the acquisition was announced, the market is suggesting that International Paper may have received the short end of the deal.

IP paid all cash in the deal, which is expected to close in the third quarter. The purchase includes more than 70 box-making sites, nine containerboard mills and 19 recycling plants that employ more than 14,000 people. But the company had just $905 million of cash on the balance sheet at the end of 2007, compared with $6.6 billion of total debt. (My prime role here at TheStreet.com is to analyze value stocks, which I do regularly for TheStreet.com Value Investor service.)

As a result, IP is going to finance the deal with a $2 billion term loan and a $4 billion 18-month bridge loan. The major credit ratings agencies have all put the company's credit rating on watch for a potential downgrade, following the deal. Standard & Poor's currently rates it BBB, which is one level away from junk status.

With that in mind, I'm here to answer readers' questions: Should you buy it? Has the risk from International Paper's acquisition been priced into the stock, or should investors continue to avoid the shares? ...