01—Abstract
Summary
Summary of the 8-K filed August 21, 2025. Cited figures are marked; the original filing is the authoritative source.
International Paper Company committed on August 20, 2025 to permanently close its containerboard, timber and lumber mills in Riceboro, Georgia, and its containerboard mill and packaging facility in Savannah, Georgia, as part of its 80/20 strategic approach.
The company estimates aggregate pre-tax cash charges of approximately $158 milliona and pre-tax non-cash accelerated depreciation charges of approximately $570 million. The closures are expected to reduce containerboard capacity by approximately 430,000 tons at Riceboro and approximately 1,000,000 tons at Savannah, with all operations ceasing by September 12, 2025 and September 30, 2025, respectively. The charges are expected to be recorded in the three months ending September 30, 2025.
The accompanying press release (Exhibit 99.1, dated August 21, 2025) also announces a definitive agreement to sell the Global Cellulose Fibers business to American Industrial Partners for $1.5 billionb, subject to closing adjustments including preferred stock with an aggregate initial liquidation preference of $190 million, with closing expected by year-end subject to regulatory approvals. It further describes a $250 million investment to convert the #16 machine at the Riverdale mill in Selma, Alabama to produce containerboard, with completion expected by the third quarter of 2026.
The mill closures are expected to affect approximately 1,100 hourly and salaried positions. For investors, the filing centers on a large restructuring of North American containerboard capacity, with the combined closures and conversion described as resulting in a net reduction of annual containerboard capacity of approximately one million tons, alongside a divestiture of the cellulose fibers business.
02—Key points
Key Highlights
- Riceboro, Georgia: containerboard mill to shut down in stages by September 12, 2025; capacity reduction of approximately 430,000 tons; about 300 employees affected; charges of approximately $170 million (non-cash asset write-off and accelerated depreciation) and approximately $77 million (cash severance and shutdown).
- Savannah, Georgia: containerboard mill and packaging facility to cease operations by September 30, 2025; capacity reduction of approximately 1,000,000 tons; about 680 employees affected; charges of approximately $400 million (non-cash) and approximately $81 million (cash).
- Aggregate estimated pre-tax cash charges of approximately $158 million and pre-tax non-cash accelerated depreciation charges of approximately $570 million, expected to be recorded in the three months ending September 30, 2025.
- Agreement to sell the Global Cellulose Fibers business to American Industrial Partners for $1.5 billion, subject to closing adjustments, including preferred stock with an aggregate initial liquidation preference of $190 million; closing expected by year-end 2025, subject to regulatory approvals.
- $250 million investment to convert the #16 machine at the Riverdale mill in Selma, Alabama to produce containerboard, with completion expected by the third quarter of 2026.
- Net reduction of annual containerboard capacity of approximately one million tons, per the accompanying press release, with approximately 1,100 hourly and salaried positions affected.
03—Questions
Frequently Asked Questions
What are the main financial charges associated with the mill closures?
The company estimates aggregate pre-tax cash charges of approximately $158 million and pre-tax non-cash accelerated depreciation charges of approximately $570 million. The company anticipates recording these charges in the three months ending September 30, 2025.
How much containerboard capacity is being removed?
The Riceboro, Georgia containerboard mill closure is expected to reduce capacity by approximately 430,000 tons, and the Savannah, Georgia containerboard mill closure by approximately 1,000,000 tons. The press release states the combined changes will result in a net reduction of approximately one million tons of annual containerboard capacity, after the Riverdale conversion.
What is the status of the Global Cellulose Fibers sale?
International Paper has reached a definitive agreement to sell the business to American Industrial Partners for $1.5 billion, subject to closing adjustments. The transaction is expected to close by the end of the year, subject to regulatory approvals.
How many employees will be affected?
The Riceboro containerboard mill closure is expected to reduce the workforce by approximately 300 employees and the Savannah containerboard mill closure by approximately 680 employees. The press release states the changes will impact approximately 1,100 hourly and salaried positions in total, and the company is committed to providing severance and outplacement assistance.
What is the company's strategic rationale for these actions?
The actions are part of the company's 80/20 strategic approach, announced in July 2024, aimed at profitable market share growth by striving to be the lowest-cost producer and reducing complexity and cost. The company describes the mill changes as positioning it for an advantaged cost position and a focus on the geographies, customers and products where it can create the most value.
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