International Paper (IP) has announced it is in exclusive negotiations with Germany-based Palm Group to sell five of its corrugated fiber box plants in Europe, a move required by the European Commission (EC) following IP’s acquisition of DS Smith, which closed in January 2025.
The proposed transaction includes two box plants and one sheet plant in Normandy, France; one box plant in Ovar, Portugal; and one box plant in Bilbao, Spain. IP stated that the deal is expected to close by the end of the second quarter of 2025. “Finding the right buyer for these five facilities has been a top priority for our team since the completion of the acquisition of DS Smith, and I’m pleased that we have found one in PALM,” said International Paper CEO Andy Silvernail.
These divestitures were mandated by the EC due to competition concerns in certain regional markets where IP and DS Smith both held significant presence. Although IP was not required to complete the sales before finalising the DS Smith acquisition, the EC stipulated that a trustee would oversee the process and that IP must submit a proposal for the acquirer’s approval within one week of identification.
The EC’s conditions also include a 10-year non-reacquisition clause, prohibiting IP from directly or indirectly reacquiring the divested plants unless the EC determines that market conditions have substantially changed. Furthermore, the buyer must already have a corrugated production footprint in the UK or European Economic Area, to ensure sustained market competitiveness.
Palm Group, headquartered in Aalen, Germany, is a containerboard, graphic paper, and corrugated packaging producer with five paper mills and 29 box plants across Europe. It employs approximately 4,200 people and reported €2 billion in revenue in 2024, according to IP’s announcement.
According to European Commission documents, the five IP plants together employ up to 750 people.
The planned sale, once finalised, will fulfil all of International Paper’s obligations to the European Commission under the conditions set forth during the merger approval process.
