Domtar is responding to recent talks of a possible sale to Paper Excellence.
Bloomberg reported Monday that the Canadian paper and packaging company is exploring a deal to acquire the U.S. rival.
In a statement, Domtar acknowledges that its management has been in discussion with Paper Excellence about a potential transaction, however, these talks may or may not result in an agreement.
Officials say the company won’t comment further unless or until there is a transaction to announce.
Domtar shares have soared since word came out in the media about a possible deal.
They closed at 59.51 Canadian on Wednesday, up from 49.70 Monday.
Paper Excellence, based in Richmond, British Columbia, makes pulp packaging and specialty paper, and owns about a 49 per cent stake in a Brazilian mill.
Domtar’s operations include a Kraft pulp mill in Dryden.
