News Summary
Kimberly-Clark has announced a joint venture with Suzano valued at $3.4 billion, focusing on the international tissue market. The partnership allows Kimberly-Clark to maintain a 49% stake while Suzano holds 51%. With operations in 14 countries and 22 manufacturing facilities, the venture aims to leverage both companies’ strengths. This strategic move will enable Kimberly-Clark to focus on growth areas while incorporating over 40 regional brands into the new entity. The deal is expected to close in mid-2026, pending approvals.
Texas
In a landmark business move, Kimberly-Clark has announced a joint venture with Brazil’s Suzano, valued at approximately $3.4 billion. This partnership will lead to a new entity focused on the global tissue market while allowing Kimberly-Clark to retain a significant stake in its international tissue operations.
Under the terms of the agreement, Kimberly-Clark will retain a 49% ownership stake in the new venture, while Suzano gains a 51% stake through a cash payment of $1.734 billion. This transaction is designed to foster a leading international company in tissue and professional products, expanding operations significantly beyond the United States.
Operational Scope and Employment Impact
The joint venture will be headquartered in the Netherlands and include 22 manufacturing facilities spanning 14 countries across global regions like Europe, Asia, the Middle East, South America, and Africa. It is projected that this venture will comprise approximately 9,000 employees and achieve a total production capacity of about 1 million tonnes of tissue annually.
Financial Relationships
The facilities and assets included in this joint venture reported net sales of approximately $3.3 billion in 2024. Despite its spin-off, Kimberly-Clark will maintain its consumer tissue and professional businesses within the United States and continue its involvement in joint ventures in Mexico, South Korea, and Bahrain.
Brand Integration
More than 40 regional brands from Kimberly-Clark’s International Family Care and Professional portfolio will be integrated into the new joint venture. Major global brands such as Scott, Kleenex, Cottonelle, WypAll, and Kimberly-Clark Professional will be licensed to the joint venture through a long-term agreement, enhancing its brand strength and market offerings.
Strategic Focus
This joint venture aligns with Kimberly-Clark’s strategic shift as it plans to concentrate on higher growth and higher margin business segments, particularly within North America and its international personal care divisions. The move is anticipated to create robust growth opportunities for both companies involved.
Leadership and Governance
The governance structure for the joint venture will consist of five board members, with Suzano appointing three members and Kimberly-Clark designating two. This collaborative leadership will support operational efficiency and strategic direction as both partners work to optimize their combined resources.
Future Considerations
Suzano will have the option to acquire Kimberly-Clark’s remaining 49% interest in the joint venture under specific conditions, which may allow for further consolidation in the future. The completion of this transaction is anticipated in mid-2026, contingent upon the approval of regulatory authorities and adherence to customary conditions.
Background on Suzano and Kimberly-Clark
Suzano is widely acknowledged as a leader in fiber production and has established a strategic alliance with Kimberly-Clark aimed at enhancing efficiency across their global supply chain. This collaboration is projected to optimize manufacturing capabilities and position the new entity competitively in the international tissue market.
This joint venture marks a pivotal moment for both companies, setting the stage for expanded reach and innovation in the global tissue industry while allowing Kimberly-Clark to sharpen its focus on core areas demonstrating higher growth potential.
Deeper Dive: News & Info About This Topic
- Business Wire: Suzano and Kimberly-Clark Announce a Global Tissue Company
- Reuters: Kimberly-Clark to Sell International Tissue Business
- Investopedia: Kimberly-Clark to Sell Majority of Global Tissue Business
- CNBC: Kimberly-Clark to Sell International Tissue Business
- PR Newswire: Kimberly-Clark Announces Major Step Forward
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