PCA Agrees to Acquire Boise

Packaging Corporation of America (PCA), headquartered in Lake Forest, Ill., and Boise Inc. have entered into a definitive agreement under which PCA will acquire Boise for about $1.995 billion, inclusive of $714 million of outstanding indebtedness of Boise. The transaction is expected to close in the fourth quarter of 2013 with committed debt financing, but is subject to certain customary conditions and regulatory approvals. 

Following the merger, PCA's containerboard capacity will increase to 3.7 million tons from its current level of 2.6 million tons including the announced expansion of a Boise’s D2 paper machine at the company’s DeRidder, La., mill. PCA’s corrugated products volume will increase by about 30 percent as a result of the acquisition, and PCA’s market presence will expand into the Pacific Northwest. 

PCA Executive Chairman Paul Stecko says, “The acquisition is an excellent fit, both geographically and strategically, with unique and substantial synergies. It provides the containerboard that PCA needs to support our strong corrugated products growth. 

Stecko continues, “The DeRidder containerboard mill is low cost, located in a very good wood basket and, after the D2 machine conversion, provides almost 1 million tons of primarily lightweight containerboard. 

Mark Kowlzan, PCA’s CEO, adds, “This acquisition allows us to apply our operating and sales expertise across a much larger system and provides significant growth potential. We look forward to working with the employees of Boise as we integrate our businesses. I am confident that together we will achieve significant operating benefits.”