RICHMOND, Virginia -- MeadWestvaco Corporation announced 22 January 2015 that it has signed a definitive agreement to sell its European-based tobacco folding carton business to AR Packaging Group AB, a maker of paperboard cartons, flexible packaging, and trays based in Lund, Sweden. The business has annual revenue of approximately $190 million (€146 million), which is included in MWV's Food & Beverage segment. Terms of the agreement were not disclosed, and the transaction is expected to be completed in the next several months.

"MWV has long been--and remains--committed to our customers in the global tobacco market," said Joe McNamara, president of MWV's Tobacco business. "This transaction gives us the opportunity to further focus our participation on our leadership position in high-quality paperboard for tobacco and other premium packaging markets around the world. Our strong teams and facilities in the folding carton space will flourish as part of AR Packaging, and MWV will continue to serve our global customers as the market for high-quality paperboard grows in many regions."

MWV's European tobacco folding carton business specializes in the manufacture and printing of hinge-lid boxes, display cartons, and high-impact cigarette packaging, as well as folding carton packaging for some chocolate confectionery and consumer apparel segments. The business has deep customer relationships in western and eastern Europe and includes manufacturing operations at three facilities in Graz, Austria; Krakow, Poland; and Moscow, Russia, which have a total of 680 employees. Also included in the sale is the tobacco and confectionery folding carton business currently served by MWV's plant in Svitavy, Czech Republic. The Svitavy plant will remain part of MWV beyond the transition period. MWV will continue to produce high-quality solid bleached sulfate (SBS) paperboard for global tobacco end markets at its Covington, Virginia, paperboard mill.