International Paper To Divest Five Box Plants In Europe, Seeks DS Smith Merger Approval

International Paper IP shares were up 2% at last check Monday, following the company’s announcement that it has agreed to sell five corrugated box plants to Germany's PALM Group.

The deal is anticipated to close by the end of the second quarter.

Chairman and CEO Andy Silvernail said that finding the right buyer for the plants, which are located across France, Portugal, and Spain, has been a priority since the DS Smith acquisition.

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"I'm pleased we have found one in PALM," he stated, adding that the company appreciates the contributions of the teams at these sites and is confident they will succeed under new ownership.

The sale fulfills a commitment made to the European Commission as a condition of International Paper's acquisition of DS Smith,. Final approval of the buyer is still pending.

Once complete, the divestment will satisfy all of IP's regulatory obligations tied to the deal.

In February, International Paper announced the planned closure of four U.S. facilities, affecting over 670 employees. The sites include the Red River containerboard mill in Louisiana, a recycling plant in Arizona, a box plant in Pennsylvania, and a sheet feeder operation in Missouri—all scheduled to shut down by April 2025. The Red River closure alone will reduce annual containerboard output by 800,000 tons.

The negotiations follow International Paper's January acquisition of DS Smith, a deal that established the company as a global leader in sustainable packaging with a strong presence in North America and Europe. The transaction is expected to yield at least $514 million in synergies and be earnings-per-share accretive in its first year.

Price Action: At the last check on Monday, IP shares were trading at around $47.54 at the time of publication.

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