International Paper in talks with bidders for EMEA packaging business

Oct 15 (Reuters) - International Paper said on Thursday it was in talks with potential bidders for its Europe, Middle East and Africa packaging business after unsolicited approaches, opening up an alternative to its planned spinoff of the unit.

The paper and packaging producer said the sale process was at an early stage and that there was no certainty a deal would be agreed. It is continuing to pursue the spinoff while evaluating the potential sale.

Shares of International Paper were up about 8%.

The statement came after the Financial Times reported citing people familiar with the matter that private equity firms Lone Star and Atlas Holdings were exploring separate bids for the business, potentially valuing it at less than $6 billion.

Atlas Holdings did not respond to a Reuters request for comment and Lone Star declined to comment.

International Paper had announced in January that it plans to split into two publicly traded companies by spinning off its EMEA business, and that the spun-off unit is expected to be listed in London and New York.

It said then that the EMEA business would consist of the combined operations in the region that originated from DS Smith, acquired for $7.2 billion last year, and from International Paper.

No assurance can be provided about the ultimate timing or structure of the proposed separation of the EMEA business, the company said on Thursday.

International Paper, which accounts for roughly one-third of the North American corrugated packaging market, has been battling soft demand due to weaknesses in consumer spending and the housing market.

The company, in July, missed Wall Street expectations for second-quarter sales and trimmed the top end of its annual profit forecast while it restructured operations.

(Reporting by Shania S Thomas and Koyena Das in Bengaluru; Editing by Joyjeet Das and Sahal Muhammed)