MEMPHIS,
Tenn., Oct. 31, 2024 /PRNewswire/ --
International Paper (NYSE: IP) today announced the decision to
review strategic options for its global cellulose fibers (GCF)
business. The decision to explore alternatives for the GCF business
is consistent with the Company's strategy to focus on sustainable
packaging solutions.
IP's GCF business creates safe, high-quality absorbent pulp for
a wide range of applications like feminine care, incontinence and
other personal care products that promote health and wellness. In
addition, its specialty pulp serves as a sustainable raw material
used in textiles, construction materials, paints, coatings and
more. The GCF business generated $2.9B in revenue in 2023 and has operations in
three countries, with eight mills and two converting
facilities.
"International Paper is committed to maximizing value for our
shareholders, and to that end, we have launched a comprehensive and
thorough review of strategic options for our global cellulose
fibers business," said International Paper Chairman and CEO
Andy Silvernail.
"GCF is focused on accelerating earnings by aligning resources
with our most strategic fluff pulp customers, implementing an 80/20
mindset and creating a simplified and focused portfolio. Our team
is well-positioned to win with attractive customers in the growing
global fluff pulp market," said Clay
Ellis, Senior Vice President, Global Cellulose Fibers,
International Paper. "Throughout our review, we will maintain our
strong customer relationships with the same high standards and
close collaboration."
International Paper has retained Morgan Stanley & Co. LLC as
financial advisor to help review strategic options for the GCF
business. The review of strategic options is at an early stage, and
there can be no assurance that this review will result in any kind
of transaction or other outcome. The Company will provide updates
on the progress or status of this matter if and when it deems
further disclosure is required or appropriate.
IP to Close Georgetown, S.C.
Pulp and Paper Mill
Additionally, the Company announced the
permanent closure of its Georgetown,
South Carolina mill. The mill will shut down in stages with
a full closure expected by the end of 2024.
The Georgetown mill produces
approximately 300,000 tons of fluff pulp designed for a range of
consumer applications from baby diapers to incontinence products.
GCF plans to retain 100% of the mill's fluff pulp capacity by
transferring production to other mills and further reducing the
Company's exposure to commodity pulp grades.
The mill also produces uncoated freesheet papers that it sells
to Sylvamo (NYSE: SLVM) pursuant to a strategic contract, which IP
and Sylvamo have mutually agreed to terminate as of December 31, 2024.
"This decision is especially difficult because of the impact on
hard-working employees, their families and the surrounding
communities," said Bernie Chascin,
Georgetown mill manager,
International Paper.
In total, 526 hourly employees and 148 salaried employees will
be impacted. All employees will be offered severance benefits,
outplacement services and access to mental health resources.
About International Paper
International Paper
(NYSE: IP) is a global producer of sustainable packaging, pulp and
other fiber-based products, and one of the world's largest
recyclers. Headquartered in Memphis,
Tenn., we employ approximately 39,000 colleagues globally
who are committed to creating what's next. We serve customers
worldwide, with manufacturing operations in North America, Europe, Latin
America and North Africa.
Net sales for 2023 were $18.9
billion. Additional information can be found by visiting
internationalpaper.com.
Forward-Looking Statements
This press release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995, as amended. These
forward-looking statements reflect management's current views and
are subject to risks and uncertainties that could cause actual
results and the timing of events to differ materially from those
expressed or implied in these forward-looking statements. These
risks and uncertainties include the risks that this review of
strategic alternatives will not result in any transaction or other
desired outcome; that we will be unable to realize the anticipated
benefits of this review of strategic alternatives; and that we will
be unable to realize the anticipated benefits from our closure of
the Georgetown, South Carolina
pulp mill. These forward-looking statements are also subject to the
risks and uncertainties contained in the Company's Annual Report on
Form 10-K for the fiscal year ended December
31, 2023, filed with the U.S. Securities and Exchange
Commission ("SEC") on February 16,
2024, the Company's Quarterly Report on Form 10-Q for the
three months ended June 30, 2024
filed with the SEC on July 26, 2024,
and subsequent reports filed with the SEC. In addition, other risks
and uncertainties not presently known to the Company or that we
currently believe to be immaterial could affect the accuracy of any
forward-looking statements. The Company undertakes no obligation to
publicly update any forward-looking statements contained in this
press release, whether as a result of new information, future
events or changes in expectations.
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SOURCE International Paper
