Newsworthy

Paper, Mergers & Acquisitions

International Paper, DS Smith finalize merger

International Paper (IP) has finalized its bid to acquire London-based multinational paper and packaging company DS Smith, as the merger officially took effect Jan. 31 and is estimated to be worth about $7.2 billion.

The combined company operates in more than 30 countries, including more than 65,000 employees at 200-plus mills and packaging plants in North America and 230-plus in Europe.

According to IP, this “new global leader in sustainable packaging solutions” will focus on the North American and Europe, Middle East and Africa, or EMEA, markets.

The new IP will maintain North American headquarters in its current hometown of Memphis, Tennessee, while its European operations will remain based in London.

“With a stronger portfolio of sustainable packaging solutions, the combination of International Paper and DS Smith enhances our offerings, increases innovation and expands our geographic reach,” IP Chair and CEO Andy Silvernail says.

The merger comes after a nearly yearlong journey that included regulatory hurdles as well as competing interest from other packaging companies.

In early March 2024, DS Smith had reached an agreement to be acquired by English packaging company Mondi before confirming later that month it was in discussions with IP over an all-stock offer.

IP and DS Smith agreed to terms of an all-share combination in mid-April 2024, however, reports surfaced claiming Brazilian pulp and paper company Suzano had expressed interest in an all-cash acquisition of IP worth nearly $15 billion; however, IP was committed to merging with DS Smith, and Mondi dropped its offer.

The IP-DS Smith deal was approved by the companies’ respective shareholders in October 2024. While the merger was expected to take effect later that year, European regulatory hurdles delayed the process.

On Jan. 23, the European Commission approved the concessions IP offered, clearing the way for the companies to finalize the transaction.

IP agreed to divest five European sites: three plants in Normandy, France, including two box plants and one sheet plant; a box plant in Ovar, Portugal; and a box plant in Bilbao, Spain.

The European Commission said these concessions “fully address the competition concerns” by removing the overlaps between the companies’ activities in the corrugated box markets in northwest France.

“The commitments also eliminate the overlap as regards the supply of corrugated sheets in the problematic local markets in Portugal and Spain and, as such, any vertical foreclosure concerns regarding corrugated cases,” the European Commission said in the Jan. 23 statement announcing its approval. The European Commission added that after “positive feedback,” it concluded the transaction as modified no longer raised competition concerns.

According to a U.S. Securities and Exchange Commission (SEC) filing, IP planned to issue 0.1285 in new shares of common stock for each ordinary share of DS Smith stock, resulting in the issuance of approximately 179.8 million new shares of the firm’s common stock.

The new shares of IP common stock began trading on the New York Stock Exchange Feb. 4 under the symbol “IP,” while IP common stock began trading on the London Stock Exchange via a secondary listing under the symbol “IPC” that same day.

The company’s SEC filing also indicates that IP expects to achieve synergies of at least $514 million from its merger with DS Smith.

“We will bring together the capabilities and expertise of two experienced teams with similar cultures to create the global leader in sustainable packaging solutions,” Silvernail says of the transaction.

Plastics

ADS breaks ground on $30M expansion

Advanced Drainage Systems Inc. (ADS), Hilliard, Ohio, has broken ground on a significant expansion of its recycling facility in Cordele, Georgia.

The company, which produces plastic pipe, chambers and other products for the stormwater and on-site septic wastewater industries, says the $30 million expansion will enhance its ability to provide recycled material to its factories in the Southeast U.S. and increase the facility’s total size to 117,000 square feet.

The Cordele facility investment also will bring streamlined testing with an on-site laboratory and create as many as 50 new jobs.

“ADS is thrilled to make this significant investment in Cordele,” President and CEO Scott Barbour says. “This state-of-the-art facility will leverage exceptional talent and cutting-edge material capabilities to enhance our recycled plastic production, enabling us to lead the industry and set new standards for innovation and sustainability. Cordele is part of a thriving economic region in an ideal location for us to efficiently manufacture and transport recycled materials to our southeastern pipe plant network.”

The company, which primarily works with polypropylene and high-density polyethylene, is one of the largest plastic recyclers in North America, sourcing postindustrial and postconsumer resins to manufacture its products.

“For over 20 years, the dedicated ADS Recycling employees in Cordele have made this location one of the top ADS performers in the nation, and we’re thrilled to bring innovative investments to this site and new career opportunities to the local community,” says Kristen Rinehart, ADS vice president and general manager of recycling. “As one of the largest plastic recycling companies in North America, expanding our operations in Cordele will allow us to deliver recycled material to our seven manufacturing sites throughout the Southeast region while expanding ADS’ overall use of recycled plastic in our pipe products and advanced stormwater and on-site septic wastewater solutions.”

ADS says the development of the facility was made possible through the support of the Cordele-Crisp County Industrial Development Council, Crisp County Commissioners and the Georgia Department of Economic Development. The Crisp County Power Commission is purchasing and installing transformers to support production capabilities for this facility.

Paper

Greif announces paperboard machine shutdown, mill closure

In “strategic actions” meant to maximize the profitability of its mill network, Delaware, Ohio-based packaging company Greif Inc. has revealed plans to permanently cease production on a paperboard machine in Georgia as well as permanently close a containerboard mill in Massachusetts.

“Decisions like these are extremely difficult because of the impact it has on our colleagues and their families, as well as the larger community,” Greif President and CEO Ole Rosgaard says in a news release.

By the end of March, the company intends to cease production on its No. 1 paperboard machine (A1) at its uncoated recycled paperboard (URB) and specialty converting site in Austell, Georgia.

Ceasing production on the Georgia A1 machine, which the company describes as a nonintegrated asset, is the result of increased costs and declining demand in its major furniture, books and binders end markets, according to Greif.

Meanwhile, by the end of May, Greif plans to permanently close its containerboard and URB mill in Fitchburg, Massachusetts. The company says that high operating costs and the need for “significant capital investment” were the determining factors in the decision to shut the mill.

“We are grateful to our colleagues in Austell and Fitchburg for their contributions to the company and are committed to helping them navigate next steps by providing severance benefits and outplacement assistance,” Rosgaard says.

Approximately 140 total jobs will be affected by the closures, and the moves will reduce Greif’s containerboard capacity by 100,000 tons and its URB capacity by 90,000 tons.

“We believe strongly in the fundamentals of our business,” Rosgaard says. “These strategic actions will refine our participation in the market and help us maximize the profitability of our mill network and our overall business portfolio.”

Metals

ArcelorMittal selects Alabama for electrical steel plant

Luxembourg-based steelmaker ArcelorMittal plans to invest $1.2 billion at its Calvert, Alabama, manufacturing site to produce up to 150,000 metric tons of nongrain-oriented electrical steel (NOES) annually.

NOES products are used in automotive, transportation and renewable electricity applications and in other industrial and commercial products, including electric motors and generators.

The firm says the project promotes American manufacturing competitiveness and “addresses a crucial market need by reducing United States dependency on electrical steel imports through the expansion of domestic NOES production.”

“We recognize the importance of creating a resilient, sustainable domestic supply chain for this critical material,” says John Brett, CEO of Schererville, Indiana-based ArcelorMittal North America.

ArcelorMittal expects construction on the NOES facility to begin before the end of June, with electrical steel production anticipated to start in 2027. Plans include installing an annealing pickling line, cold-rolling mill, annealing coating line, packaging and slitter line and additional ancillary equipment needed for specialized electrical steel manufacturing operations.

The site will consume semifinished steel made at ArcelorMittal’s electric arc furnace (EAF) plant in Calvert that it says is nearing completion. EAF mills typically consume considerable amounts of ferrous scrap, though ArcelorMittal also has invested in a hot-briquetted iron (HBI) production plant in Texas.

ArcelorMittal Calvert is a wholly owned subsidiary of ArcelorMittal, one of the world’s leading steel and mining companies, with a presence in 60 countries and steelmaking facilities in 15 nations. In 2024, ArcelorMittal had revenue of $62.4 billion and crude steel production of 57.9 million metric tons.

The firm also released its 2024 and fourth-quarter financial results, reporting net income of more than $1.3 billion, though ArcelorMittal lost $390 million in the fourth quarter.

“Last year was challenging from a global economic perspective, but despite this, [our] earnings before interest, taxes, depreciation and amortization [EBITDA] per metric ton at $130 is considerably higher than the five-year average pre-COVID,” ArcelorMittal CEO Aditya Mittal says.

Transportation

Toppoint Holdings expands its WM partnership

Toppoint Holdings Inc., a company that specializes in transporting recovered paper, scrap metal and logs for waste and recycling companies and commodity traders, has expanded its partnership with Houston-based WM following the company’s purchase of Winter Bros. Waste Systems, a Long Island, New York-based independent hauler. That transaction was finalized in mid-July of last year.

Toppoint, headquartered in North Wales, Pennsylvania, is expected to handle an additional 1,000 new loads annually from WM, representing an anticipated revenue impact of up to $2 million per year. Operations for this expansion are set to begin early in the second quarter of this year.

Toppoint currently moves about 13 percent of WM’s recyclables for export through the ports of Newark, New Jersey; Philadelphia; and Baltimore.

“Expanding our relationship with [WM] is a testament to Toppoint’s reliability and operational excellence,” Toppoint Holdings CEO Leo Chan says. “We are committed to providing best-in-class logistics solutions, and this additional volume allows us to further enhance efficiency and our service to one of our largest customers.”

The additional freight volume aligns with Toppoint’s growth strategy, which focuses on increasing operational scale, optimizing logistics efficiency and expanding its footprint in key markets. The company says its ability to provide cost-effective and scalable logistics solutions positions it to capitalize on market opportunities and further solidify its role as a leading provider in this essential sector.

Toppoint’s operations extend to major ports, including Newark and Philadelphia, and it expanded into the recycling export transport markets of Tampa, Jacksonville and Miami, Florida; Baltimore; and Ensenada, Mexico, as of 2024. Toppoint also provides trucking and logistics brokerage solutions for plastic and other commodities, servicing key commercial hubs across the U.S.

Earlier this year, Toppoint closed its initial public offering of an aggregate of 2.5 million shares of its common stock at a price of $4 per share, for a total of $10 million in gross proceeds before deducting underwriting discounts and estimated offering expenses.

The company’s shares began trading on the NYSE Jan. 22 under the symbol TOPP.