International Paper (IP) and Shandong Sun Paper Ltd. have agreed to form a 50/50 joint venture for coated board production in Yanzhou City, Shandong Province.

The companies expect to sign the agreement during IP CEO John Faraci's visit to Jinan, the capital city of Shandong Province, in early April.

The joint venture includes two coated paperboard machines located in Yanzhou City, and construction of a third coated paperboard machine, expected to be completed in late 2007. IP's investment in the venture is expected to be approximately US$140 million. This amount includes IP's share of the investment in the new paper machine.