International Paper do Brasil to Sell Amcel to Marubeni and Nippon Papers Industries

Sao Paulo, Brazil, 27 November 2006 -- International Paper do Brasil signed a memorandum of understanding with Marubeni Corporation and Nippon Papers Industries Co. Ltd. for the sale of Amapá Florestal e Celulose S.A. (Amcel), a subsidiary company that produces and exports wood chips and biomass. The sale is subject to the approval to the companies' boards of directors.

In addition to producing wood chips and biomass, Amcel's business activities encompass approximately 165,600 acres of pine and eucalyptus forests located in the municipal regions of Santana, Tararugalzinho, Porto Grande, Ferreira Gomes, Amapá, and Itaúbal do Piririm, all located in the Brazilian state of Amapá. Amcel is located in Santana, in Amapá.

The sale of Amcel is in line with International Paper's transformation plan, launched in 2005 by the company's global board of directors. The transformation plan established that the company will focus on its global uncoated paper and packaging businesses, and xpedx, its North American distribution segment.

"Amcel has been a solid contributor to the company, with consistently high productivity levels. Amcel's talented management team, highly qualified professionals, high-quality products, and unique commercial relationships with its clients are outstanding characteristics. However, the sale of Amcel is important and strategic to the achievement of the goals of the transformation plan, the ultimate objective of which is to turn IP into a more focused global company," said Maximo Pacheco, executive president of International Paper do Brasil.

About Amcel

Amapá Florestal e Celulose S.A. (Amcel) was established in 1976, to plant fast-growing forests (based on species adapted to local conditions) in the State of Amapá and process timber into wood chips for use in the production of pulp, paper, and solid wood products. In 1996, Champion Papel e Celulose pulp and paper manufacturing company acquired shareholding interest in Amcel. In 2000, International Paper acquired controlling interest in Champion, and Amcel became part of the International Paper Group.

The entire production of eucalyptus and pine chips - equivalent to 1 million metric tons (GMT) - is exported to the United States, Europe, and Japan for the manufacturing of pulp and wood products (boards and panels). In addition to the management and control of the processing and marketing of the wood chips, Amcel also produces biomass, which is obtained from residues of the debarking of pine and eucalyptus logs, and from wood chip residues. The wood chip residues are used to produce energy.

"The success of Amcel's business activities would not have been possible without the help of its professionals, who are highly competent, talented, and committed to the company's business strategies in Brazil. These strategies are the result of on-going investments in modern and innovative human resource policies. This is the biggest asset for the company's new controlling shareholders - they will inherit the values and professionalism of Amcel's employees," said Pacheco.

Amcel employees, approximately 1000 professionals (including company and outsourced employees), have enormous expertise in the wood products field. Amcel is totally committed to the health, safety, and quality of life of its employees. Amcel supports the communities where its employees live and work, as attested to by the company's social accountability and environmental actions in the fields of education, health care, and environmental conservation.

Since 2003, Amcel has invested more than R$1.4 million in actions for local communities located in areas adjacent to the company's facility in Santana, as well as in the municipal regions of Tartarugalzinho, Porto Grande, and Ferreira Gomes.

From January 2005 to October 2006, Amcel invested R$468,000 in community programs that resulted in the actual improvement of the local population's quality of life.

Projeto Pirralho, conceived by the Higher Court of the State of Amapá (TJAP) in 1997, organizes professional training programs that focus on teaching basic information technology skills, as well as handicrafts. Amcel has acted as the TJAP partner in this project since 1998. The Project trains multiplying agents, promotes healthy nutrition and fosters the development of regional arts and crafts. The training programs are held for young people living in Porto Grande and Ferreira Gomes. Since 1998, the beginning of the partnership between the TJAP and Amcel, 1455 local people have benefited from the Project.

Other corporate social accountability activities conducted by Amcel include the "Escola de Madeira" (School of Wood) program, which is run in Santana and Tartarugalzinho. This program includes courses on regional arts and crafts and on basket weaving. It trains multiplying agents, teaches the local population about healthy nutrition, holds technical training programs for plumbers and house painters, and teaches basic information technology skills. The "Escola de Madeira" program has already trained 805 people since 2001. These two projects have benefited 2260 people from the State of Amapá.

Amcel has been granted a number of environmental permits, such as the permit to plant eucalyptus trees, establish a seedling nursery in Tartarugalzinho, operate a wood chip factory in Santana, and premises for the loading and transportation of biomass, and for a residue storage facility. In addition, Amcel has obtained ISO 14001 Certification, granted by BVQI, a company that is part of the Bureau Veritas Quality International Group, the global leader of services related to certification.

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 United States, Europe, South America, and Asia. These businesses are complemented by 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. To learn more, visit http://www.internationalpaper.com.