WWF, a subsidiary of US company Gould Paper, is negotiating with London-based private equity firm Bridgepoint Capital to buy its remaining 70% stake.

The sale of the Salehurst Group would include its UK independent paper merchant Salehurst, and Gallium E.U.R.L, a paper management company based in France.

Gould Paper chairman and president Harry Gould Jr, said the acquisition would create one of the largest paper brokers and distributors in the UK, after PaperlinX, Antalis and Map Merchant Group. The deal would potentially double the sales of WWF International UK to around 80m a year.

Salehurst chief executive Terry Blyth said the two parties had made good progress in discussions, and were hopeful a deal could be completed by Mid-February.

If we can pull this off we are creating a significant force in the third channel which has to be good for customers and mills, he said.

Blyth said all employees, paper mill clients and customers had been informed of the discussions, with most giving a positive reaction.

One of Salehursts largest customers is publishing group Emap, which accounts for almost 40% of the independent paper suppliers turnover.

Former Salehurst chief executive Matthew Valentine, who left the company in 2002, said he was, not surprised by news of the discussions, and that the deal would, be a very good strategic move for Gould Paper. They are an excellent company and I think its the right move, he said.

Founded in 1924, Gould Paper Corporation is based in New York, and is the third largest distributor of fine papers in North America with annual sales in excess of 547m ($1bn).

by Andy Scott