and Ilim Pulp, the largest forest-products operation in Russia, have signed a letter of intent to establish an equally owned joint venture that will be based in St. Petersburg.
The joint venture would be created through International Paper purchasing a 50% equity interest in Ilim Holding.
The total valuation of Ilim Holding is roughly $1.3 billion.
Ilim Pulp operates four pulp and paper mills and annually produces around 2.5 million tons of pulp, uncoated papers and packaging.
Ilim Holding is in the process of consolidating ownership of the individual mills into a single Russian open joint-stock company.
The sides hope to finalize the agreement in the first quarter.
The pulp and paper mill that International Paper operates in Svetogorsk, in the Leningrad region, would remain separate from the joint venture. Ilim Pulp's wood-products enterprises won't be part of the venture either.