IP to Seek IRS Approval for MLP Structure
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International Paper Co., Memphis, Tenn., USA, has announced that it plans to ask the U.S. Internal Revenue Service for permission to convert part of its business into a master-limited partnership, or MLP, CEO Mark Sutton was quoted by bloomberg.com this week.
"There’s a lot of work going on into better understanding what an MLP structure might look like, specifically for International Paper, and whether we would benefit from such a structure and whether we can create value for our shareholders," Sutton said on a conference call this week. Sutton noted that IP is preparing to request a so-called private letter ruling from the IRS.
MLPs, commonly used in the oil and gas industry, pay no federal tax as long as they distribute most of their cash to shareholders. In September, previous IP Chairman John Faraci told a conference in New York that the company had moved "from the study phase to a more serious evaluation" of a master-limited partnership.
