Feb 01, 2007. /Lesprom Network/. International Paper announced on February 1 that it has completed its previously announced exchange of Brazilian pulp and paper assets with Votorantim Celulose e Papel S.A. (VCP). As outlined in the agreement between the two companies signed in September 2006, International Paper exchanged its in-progress pulp mill project (with approximately $1.15 billion in pre-funded project costs) and about 100 000 hectares of surrounding forestlands in Tres Lagoas, state of Mato Grosso do Sul, Brazil, for VCP's Luiz Antonio uncoated paper and pulp mill and approximately 55 000 hectares of forestlands located in the state of Sao Paulo, Brazil. Going forward, VCP will complete the 1 million-metric-tonne pulp mill in Tres Lagoas, and International Paper will build a 200 000-metric-tonne uncoated paper machine on a site adjacent to the mill, with an option to build a second similar machine in the future. The two parties have also negotiated a long-term supply agreement whereby VCP will provide pulp, utilities and other services to International Paper's Tres Lagoas operations at market prices. "This investment complements our global strategy, improving our competitive position, while adding value to shareowners. The project is immediately earnings accretive, with greater than cost of capital returns, and doubles the EBITDA of our Latin American business," said John Faraci, International Paper chairman and chief executive officer. "The Luiz Antonio mill is a globally cost-competitive paper mill, and its addition to our portfolio, along with our plans for the paper operations in Tres Lagoas, significantly expands our uncoated freesheet capacity in Latin America while providing growth opportunities in the region." Headquartered in the United States, International Paper has been a leader in the forest products industry for more than 100 years. The company is currently transforming its operations to focus on its global uncoated papers and packaging businesses, which operate and serve customers in the U.S., Europe, Latin America and Asia, as well as xpedx, an extensive North American merchant distribution system. International Paper is committed to environmental, economic and social sustainability, and has a long-standing policy of using no wood from endangered forests.