Packaging Corporation of America has entered into a definitive agreement to purchase the containerboard business of Greif, Inc. for $1.8 bn in cash. The transaction is expected to close by the end of PCA’s third quarter, subject to certain customary conditions and regulatory approvals.
The Greif containerboard business includes two containerboard mills with approximately 800,000 tons of production capacity and eight sheet feeder and corrugated plants located across the United States. The business generated approximately $1.2 bn in sales and $212m of EBITDA for the 12 months ended April 30, 2025.
Synergies are estimated to generate pre-tax benefits of approximately $60m and are expected to be fully realized within two years after closing. The synergies are projected to come from improved operational and production capabilities and efficiencies at the mills, increased integration, mill grade optimization and lower transportation costs. Approximately one half of the benefits are expected by the end of the first year with the remainder being received by the end of the second year.
Mark Kowlzan, CEO, PCA, said, “This acquisition furthers PCA’s profitable growth strategy. The mills nicely complement PCA’s system and will provide containerboard to support PCA’s continued corrugated products growth. We expect to achieve significant synergies with minimal capital investment through our operational expertise and will identify even more opportunities within the combined system for future high return investments to grow with our corrugated and sheet feeder customers. We will continue to generate significant cash flows and value for our shareholders.”
Tom Hassfurther, President, PCA, added, “We have a great deal of respect for Greif and are pleased to have reached agreement to acquire this business. Greif’s people have developed deep and lasting relationships with their customers, who we look forward to serving with Greif’s well capitalized facilities. It is a very strong cultural fit with us in terms of safety, innovation, growth and dedication to serving the needs of customers. We will apply the sales, customer service and operational expertise of the combined organization to even better serve our corrugated and sheet feeder customers and achieve additional growth and profitability.”
