International Paper to sell fibers unit for $1.5 billion

International Paper (NYSE: IP) announced it will sell its Global Cellulose Fibers business to American Industrial Partners for $1.5 billion, subject to closing adjustments. The transaction includes preferred stock with an initial liquidation preference of $190 million and is expected to close by year-end pending regulatory approvals.

The cellulose fibers business generated $2.8 billion in revenue in 2024 and employs 3,300 people globally across nine manufacturing facilities. The unit produces pulp for personal care products and specialty applications in construction materials and coatings.

International Paper will invest $250 million to convert machinery at its Riverdale mill in Selma, Alabama, to produce containerboard. The conversion is scheduled for completion by the third quarter of 2026.

The company will permanently close its Savannah, Georgia containerboard mill, Savannah packaging facility, and Riceboro containerboard mill by the end of September. These closures will eliminate approximately 1,100 positions and reduce annual containerboard capacity by about one million tons.

"While difficult, these decisions are essential to positioning International Paper for long-term success," said Tom Hamic, executive vice president of the North America Packaging Solutions business.

The Memphis-based company reported net sales of $18.6 billion in 2024. International Paper acquired DS Smith in 2025 to expand operations in North America and Europe, Middle East and Africa regions.

Morgan Stanley served as financial advisor and Debevoise & Plimpton provided legal counsel for the cellulose fibers sale.

You May Also Be Interested In