International Paper and DS Smith Join Forces

If you’re a small business owner who keeps an eye on developments in the packaging industry, here’s some big news: International Paper (IP) has officially completed its merger with London-based paper and packaging powerhouse DS Smith. The deal, finalized on January 31, is valued at approximately $7.2 billion.

A Global Presence

This merger brings together two giants in sustainable packaging, creating a company with operations in more than 30 countries. Combined, they employ over 65,000 people at 200+ mills and packaging plants across North America and 230+ facilities throughout Europe.

The new entity aims to focus heavily on markets in North America and the EMEA (Europe, Middle East, and Africa) region. IP will keep its North American headquarters in Memphis, Tennessee, while its European operations will remain based in London.

According to IP’s leadership, the merger is set to enhance the company’s sustainable packaging offerings, boost innovation, and broaden its market reach. This could mean exciting developments for small businesses looking for greener packaging solutions.

The road to this merger wasn’t without challenges. Initially, DS Smith had agreed to be acquired by another English packaging company, Mondi. However, by March 2024, DS Smith entered talks with IP, leading to an all-share agreement by mid-April.

Despite interest from Brazilian pulp and paper company Suzano—which reportedly made a nearly $15 billion all-cash offer—IP stayed the course with DS Smith. Regulatory hurdles in Europe also delayed the merger’s finalization.

To address European regulatory concerns, IP agreed to sell five sites across France, Portugal, and Spain. These concessions were necessary to address competition issues in the corrugated box and sheet markets. With these divestitures, the European Commission gave the green light for the merger.

For small businesses, particularly those that prioritize sustainable operations, this merger could signal better access to innovative and eco-friendly packaging solutions. The combined expertise of these two companies is expected to yield at least $514 million in operational synergies—which may translate into cost savings and efficiency improvements that benefit downstream customers.

As part of the merger, IP will issue approximately 179.8 million new shares of common stock. These shares are expected to begin trading on the New York Stock Exchange on February 4 under the symbol “IP” and on the London Stock Exchange under the symbol “IPC.”

For small business owners, staying updated on industry mergers like this one can provide valuable insights into evolving packaging trends. Whether you’re sourcing sustainable cardboard packaging or simply keeping tabs on market changes, this merger could mark a turning point for the industry—one worth watching closely and choose Greene Recycling for your cardboard bale pickup route!