Graphic Packaging has agreed to divest its Augusta, Georgia, US-based bleached paperboard manufacturing site to Clearwater Paper for a price of around $700m.
The deal amount is based on adjusted EBITDA of approximately $100m.
Clearwater Paper supplies bleached paperboard and private-brand tissue products. The company’s tissue caters to supermarkets, clubs, mass merchants, discount stores, and private brand market retailers.
The paperboard operations of the company include custom sheeting, slitting, and cutting services to quality-conscious packaging converters and printers.
Graphic Packaging president and CEO Michael Doss said: “Augusta is an outstanding asset with a great team, which we concluded is a more compelling fit with Clearwater Paper’s strategic growth plans than our own.
“Bleached paperboard plays a major role in sustainable consumer packaging, and we will continue to service growing foodservice and packaging demand with bleached paperboard from our Texarkana facility.”
Atlanta, Georgia-based Graphic Packaging creates and manufactures consumer packaging. The company serves brands in food, drink, food service, home goods, and other consumer goods using its global network of design and manufacturing facilities.
Clearwater Paper CEO Arsen Kitch said: “Augusta is a great fit with our strategy and improves our position as a premier, independent paperboard supplier to North American converters.
“I look forward to welcoming the Augusta team to Clearwater Paper as we work together to build a more scaled paperboard business to service our customers.”
The deal is anticipated to conclude in Q2 2024, subject to regulatory approvals. Clearwater Paper’s finance adviser is TD Securities while its lead transaction counsel is Pillsbury, Winthrop, Shaw, Pittman. Its environmental counsel is Stoel, Rives. BofA Securities is Graphic Packaging’s financial advisor, while Alston & Bird is the company’s principal transaction counsel.