Meadwestvaco Corp.

MEADWESTVACO CORP. (MWV), Stamford, Connecticut, USA has reached a definitive agreement to sell its Papers business and associated assets for US$ 2.3 billion to a new company controlled by Cerberus Capital Management L.P., New York, New York, a private investment firm. The sale is subject to customary closing conditions, including regulatory approvals and purchaser's financing, and is expected to be complete in the second quarter of 2005. MWV expects the transaction to result in after-tax net proceeds of approximately US$ 2.1 billion at closing, which it will use to improve its overall capital structure.

After the closing, MWV will have more than US$ 6 billion in annual revenues from its packaging business and international sources, and approximately 24,000 employees. Under the terms of the agreement, the new company will acquire MWV's Papers business, with mills having a combined annual capacity of approximately 2.05 million tons of coated paper, 290,000 tons of carbonless paper, and 110,000 tons of uncoated paper. The sale also includes approximately 900,000 acres of U.S. forestlands. After the sale of the Papers business, MWV will own approximately 1.2 million acres of forestland.

The acquiring company will be privately held and headquartered in Dayton, Ohio, with the current Papers management team continuing to lead the business. Peter H. Vogel, Jr., current president of MWV's Papers Group, will become CEO of the new company. Approximately 6300 employees of the Papers business are expected to join the new company, including corporate staff who have been exclusively dedicated to supporting that business.