International Paper has reached a definitive agreement with American Industrial Partners (AIP) to sell its Global Cellulose Fibers (GCF) business for $1.5 billion, subject to closing adjustments, including the issuance of preferred stock with an aggregate initial liquidation preference of $190 million. The company previously announced the decision to review strategic alternatives for its GCF business last fall, as part of the company’s strategy to focus on sustainable packaging solutions. The transaction is expected to close by the end of the year, subject to regulatory approvals.

“GCF is a strong business, and I’m pleased to see it transitioning to AIP, which is focused on investing in and growing industrial businesses,” says IP CEO Andy Silvernail. “Over the past few months, GCF has done the hard work of aligning resources with its most strategic customers, implementing an 80/20 mindset, and creating a simplified and focused portfolio. These actions, combined with its talented and committed team made it an attractive investment for AIP to enter the pulp market and have positioned GCF for long-term success under new ownership.”

“GCF is well-positioned for future growth, supported by its large and sustainable wood basket, durable end markets, industry leading quality and innovation, long-term customer relationships, deeply knowledgeable employees and well-invested facilities,” says Rick Hoffman, Partner at AIP. “We look forward to partnering with GCF senior vice president Clay Ellis and the rest of the talented and tenured management team to implement their growth vision.”

The GCF business creates safe, high-quality pulp for a wide range of applications like towel and tissue products, diapers, 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 construction materials, paints, coatings and more. GCF generated $2.8 billion in revenue in 2024 and has 3,300 employees globally, with nine manufacturing facilities and eight regional offices. 

International Paper’s packaging business in North America has initiated a number of actions to enhance its ability to serve and grow with customers while improving its manufacturing footprint, including:

• Investment of $250 million to convert the #16 machine at the Riverdale mill in Selma, AL to produce containerboard
• The permanent closure of the Savannah, GA containerboard mill, the Savannah, GA packaging facility, Riceboro containerboard mill and Riceboro Timber and Lumber

These changes will impact approximately 1100 hourly and salaried positions. International Paper is committed to supporting affected employees through this transition. The company will offer severance packages, along with outplacement assistance for eligible employees, to support them during this transition.

“We understand how deeply these decisions affect our employees, their loved ones, and the surrounding communities,” says Tom Hamic, executive vice president and president of International Paper’s North America Packaging Solutions business. “We are committed to supporting both our employees and customers as we navigate this transition.”

“While difficult, these decisions are essential to positioning International Paper for long-term success, enabling us to focus on the geographies, customers and products where we can create the most value,” Hamic adds. “Our investment in the Riverdale mill reflects our commitment to delivering high-quality, reliable service while strengthening our advantaged cost position.”

The Riverdale conversion is expected to be completed by the third quarter of 2026. The Riceboro and Savannah mills will shut down in phases by the end of September 2025, and the Savannah packaging facility will also cease operations by the end of September. These combined changes will result in a net reduction of the company’s annual containerboard capacity by approximately one million tons.