There are stirrings that buyouts are making a comeback. Look at private equity firm, Cerberus Capital. Today, the firm has announced that it will shell out roughly $2 billion for the North American paper operations of Stora Enso (Stora Enso will retain a 19.9% equity stake).
The deal is fairly strategic as Cerberus already owns NewPage, which is a coated paper producer. As a result, Cerberus will merge the Stora operations with NewPage. Yes, having scale can be a huge benefit in the private equity world – in terms of financing and synergies.
However, the paper business is tough. With the declines in newspapers and magazines, it's certainly hard to find growth.
But Cerberus usually is contrarian. Hey, it bought Chrysler, right?
Tom Taulli is the author of various books, including The Complete M&A Handbook
