International Paper Purchases Shorewood for About $600 Million

Updated from 9:55 a.m. EST

International Paper (IP Quote) announced Thursday that it would acquire Shorewood Packaging (SWD Quote) for about $600 million in cash, effectively foiling rival Chesapeake's (CSK Quote) $500 million hostile bid.

The market liked the deal. Shares of Shorewood, based in New York City, jumped 1 7/8, or 10%, to close at 20 3/4, slightly lower than International Paper's bid. Meanwhile, shares of International Paper, based in Purchase, N.Y., were down just 11/16, or 2%, to close at 42 1/2. ...