International Paper (IP) has completed its acquisition of Temple-Inland, a manufacturing company focused on corrugated packaging and building products, consisting of seven mills and 59 converting facilities.
Temple-Inland is now a wholly owned subsidiary of IP. The total transaction was valued at approximately $4.5 billion. IP’s subsidiary, Metal Acquisition Inc., has now been merged with and into Temple-Inland.
As part of the agreement with the Antitrust Division of the U.S. Department of Justice, the combined company will be divesting 970,000 tons of containerboard mill capacity within four months, with the possibility of two 30-day extensions. The company agreed to divest Temple-Inland’s facilities in Ontario, Calif. and New Johnsonville, Tenn., and IP’s facility in Hueneme, Calif. Even with the divestitures, IP said that it expects to achieve at least $300 million of synergies within twenty-four months. IP currently owns and operates 12 containerboard mills and 133 box plants that convert containerboard into corrugated boxes in the United States.
“We are very pleased to have completed this compelling transaction,” said IP chairman and CEO John Faraci. “The combination of International Paper and Temple-Inland strengthens our North American packaging business and enhances our ability to generate cash flow while maintaining our strong balance sheet.”
