WASHINGTON, DC The Department of Justice today announced

that it will require the divestiture of a doorskin manufacturing

plant in order for Premdor Inc. to proceed with its proposed $527

million acquisition of Masonite Corporation and related

businesses from International Paper Company. A doorskin is the

component that makes up the front and back of an interior molded


The Department said the acquisition, as originally proposed,

would have substantially lessened competition in the interior

molded doorskin and interior molded door markets by restructuring

the industry in a way that facilitates coordination among the

dominant firms. The proposed divestiture will preserve

competition by requiring the divestiture of Masonite’s Towanda,

Pennsylvania facility, one of its two U.S. interior molded

doorskin manufacturing plants, to maintain an independent molded

doorskin manufacturer.

The Department’s Antitrust Division filed a lawsuit today in

U.S. District Court in Washington, D.C. to block the proposed

transaction. At the same time, the Department filed a proposed

consent decree that, if approved by the court, would resolve the

lawsuit and the Department’s competitive concerns.

“Without the divestiture of the plant, consumers of interior

molded doorskins and interior molded doors — door manufacturers,

distributors, building supply outlets, home centers, lumber

yards, and home owners — would likely have paid higher prices,”

said Charles A. James, Assistant Attorney General in charge of

the Department’s Antitrust Division.

Masonite is the largest of only three significant

manufacturers of molded doorskins, the primary component needed

to manufacture molded doors, and in 2000, it sold over half of

all interior molded doorskins purchased in the United States. It

is the only major molded doorskin manufacturer that is not

vertically integrated into the production of molded doors.

Premdor is one of two major manufacturers of molded doors,

selling over 40 percent of all interior molded doors purchased in

the United States last year. It is also Masonite’s largest

customer and a small, but significant, competitor of Masonite in

the molded doorskin market, selling less than 10 percent of all

interiors molded doorskins in the United States last year. The

other significant manufacturer of molded doors, not a party to

the Department’s lawsuit, is also a significant manufacturer of

molded doorskins. The acquisition, as proposed, would have

removed Premdor as a competitor in the interior molded doorskin

market and resulted in the markets for interior molded doorskins

and interior molded doors being dominated by two similarly sized

vertically integrated firms.

Premdor Inc., headquartered in Mississauga, Ontario, Canada,

is an international manufacturer of interior and exterior doors

and the world’s largest manufacturer and merchandiser of interior

molded doors. The company reported revenues of approximately

$1.29 billion in 2000. Premdor U.S. Holdings, Inc., a subsidiary

of Premdor Inc., is headquartered in Tampa, Florida and owns

Premdor Inc.’s U.S. facilities involved in the manufacture and

sale of doors.

International Paper Company, headquartered in Stamford,

Connecticut, is an international corporation involved in the

businesses of printing paper, packaging, distribution, chemical

and petroleum products, and building materials. The company

reported revenues of approximately $28.2 billion in 2000.

Masonite Corporation, a subsidiary of International Paper

Company, is headquartered in Chicago, Illinois and manufactures

interior molded doorskins in Towanda, Pennsylvania and Laurel,


As required by the Tunney Act, the proposed consent decree,

along with the Department’s competitive impact statement, will be

published in the Federal Register. Any person may submit written

comments concerning the proposed decree during a 60-day comment

period to J. Robert Kramer II, Chief, Litigation II Section,

Antitrust Division, U.S. Department of Justice, 1401 H Street,

N.W., Suite 3000, Washington, D.C. 20530. At the conclusion of

the 60-day comment period, the Court may enter the final judgment

upon a finding that it serves the public interest.