Kimberly-Clark, the maker of household brands like Kleenex, is on the verge of selling its tissue business outside of North America to Brazilian pulp and paper giant Suzano for approximately $3.5 billion. According to sources familiar with the matter, a deal between the two companies could be finalized as early as Thursday. Neither Kimberly-Clark nor Suzano has publicly commented on the potential transaction.
The decision to divest the international tissue unit is part of a broader corporate restructuring effort initiated by Kimberly-Clark last year. The move aligns with the company’s strategy to streamline operations and focus more on core markets. The division on offer reportedly generates about $500 million annually in earnings before interest, taxes, depreciation, and amortization (EBITDA), and has drawn interest from multiple global players in the paper and pulp industry.
Competitive Bidding and Strategic Interest from Suzano
Earlier this year, it was reported that Suzano was one of three final contenders bidding for Kimberly-Clark’s international tissue business. Other finalists included Royal Golden Eagle (RGE) of Southeast Asia and Asia Pulp & Paper Co. (APP). The business segment was originally estimated to be worth around $4 billion, slightly higher than the expected $3.5 billion deal with Suzano.
Suzano’s interest in expanding its tissue operations is consistent with its ongoing strategy to grow its global footprint. In 2022, the company acquired Kimberly-Clark’s tissue paper operations in Brazil, signaling a clear interest in bolstering its consumer product segment beyond pulp production. The addition of the non-North American Kleenex and tissue businesses would further position Suzano as a major player in the global tissue market.
While the final deal terms have not been officially disclosed, insiders suggest the structure may include both cash and debt components. The acquisition would allow Suzano to access key markets across Europe, Asia, and Latin America where Kimberly-Clark’s tissue products are well-established.
Restructuring and Market Pressures Drive the Move
Kimberly-Clark’s decision to sell its international tissue operations comes at a time of increasing pressure on global consumer goods companies. The business has faced rising production costs, which were exacerbated by U.S. trade tariffs under former President Donald Trump. In April, the company lowered its annual profit forecast, citing these tariffs as a significant financial burden.
The restructuring initiative is aimed at consolidating Kimberly-Clark’s focus on more profitable and stable segments, particularly in North America. By offloading a division that still performs well but lies outside its geographic priorities, the company aims to free up resources and improve overall efficiency.
The proposed deal with Suzano not only helps Kimberly-Clark streamline its operations but also represents a significant step for Suzano’s international ambitions. If completed, the agreement would be one of the most notable cross-border acquisitions in the pulp and tissue sector in recent year.
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