Kimberly-Clark (KMB) Set to Divest Global Tissue Unit to Refocus Portfolio

According to the Wall Street Journal (WSJ), Kimberly-Clark Corp. (NASDAQ:KMB) is in advanced discussions to divest its international tissue business, with Brazilian pulp producer Suzano SA emerging as the likely buyer. The potential deal, reportedly valued at around $3.5 billion, could be finalized as early as this week, according to people familiar with the matter. However, none of the parties has issued any formal confirmation.

The division, called International Family Care & Professional, includes brands like Kleenex, Scottex, Andrex, and WypAll. It is Kimberly-Clark’s smallest unit, generating annual sales of less than $3.5 billion and being the least profitable. The company is exploring strategic options as part of efforts to refocus on higher-margin businesses.

Interest in the unit has been high, with Indonesia’s Asia Pulp & Paper Co. (APP) and Royal Golden Eagle also participating in the bidding process. In April, a Bloomberg report indicated that APP was seeking up to $2 billion in financing to support its bid, though no further developments have been disclosed since. WSJ also notes that Suzano acquired Kimberly-Clark’s Brazilian tissue business in 2023.

The timing of the potential sale coincides with Kimberly-Clark’s broader cost rationalization effort. The company recently revised its 2025 earnings outlook downward, citing escalating supply chain costs driven by new tariffs. The company now expects flat to positive adjusted operating profit for 2025 (on a constant currency basis), which is down from the high single-digit growth rate it forecasted in January. Management is addressing $300 million in additional costs due to tariffs through supply chain adjustments.

In that context, the sale of the underperforming tissue unit could free up capital and management bandwidth, supporting the company’s push to simplify operations and improve profitability amid rising macroeconomic and geopolitical uncertainty.

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