Brazilian pulp producer Suzano is expected to receive unconditional European Union (EU) antitrust approval for its $3.4bn joint venture with US consumer goods group Kimberly-Clark, Reuters reported citing sources.

The European Commission is anticipated to clear the deal following a preliminary review later this month, having found no competition concerns with the transaction.

If granted before the end of the month, the approval would be a key step for the deal.

Under the terms of the arrangement, announced in June last year, Suzano will acquire a 51% stake in Kimberly-Clark's international tissue operations, with Kimberly-Clark retaining the remaining 49%.

Suzano will pay $1.73bn in cash upon closing, subject to customary post-closing price adjustments, and also holds a call option to buy out its partner's stake at a later date.

The combined entity, to be incorporated in the Netherlands, will span 22 manufacturing facilities across 14 countries in Europe, Asia, the Middle East, South America, Central America, Africa, and Oceania, with a combined installed capacity of around one million tonnes of tissue per year.

It will be governed by a five-member board, with Suzano appointing three directors and Kimberly-Clark two.

The venture will employ approximately 9,000 people and sell brands including Kleenex, Scott, Cottonelle, and WypAll across more than 70 countries.

The underlying assets recorded net sales of roughly $3.3bn in 2024.

Kimberly-Clark will retain its consumer tissue and professional businesses in the US, along with its interests in existing joint ventures in Mexico, South Korea, and Bahrain, among other markets.

The transaction remains subject to a separate review by the UK's Competition and Markets Authority, which opened its investigation in March, with a decision expected by 28 May.

The deal comes as the global paper industry undergoes a period of consolidation, driven by weakening demand and structural overcapacity.