International Paper announced plans to separate into two independent, publicly traded companies: a North America-focused International Paper and a new EMEA Packaging business focused on Europe, the Middle East, and Africa. The company said the move is intended to accelerate profitable growth by sharpening each business’s operational and capital-allocation priorities based on distinct regional market dynamics.
Under the plan, International Paper would consist of its current North American operations, including both legacy International Paper and DS Smith assets in the region. The second company, EMEA Packaging, would include the combined DS Smith and International Paper packaging assets across EMEA and would operate in 30 countries. International Paper said the split follows a year of work integrating DS Smith and applying its 80/20 performance system to identify regional operating improvements, strengthen delivery, and improve supply positioning in both geographies.
International Paper said the North American business will focus on customers and innovation while targeting an advantaged cost position. The company highlighted actions already underway to streamline its footprint, decentralize operations, and optimize its network through its lighthouse model. After the separation, the company expects to compound earnings, grow cash flows, and support shareholder returns, with plans to accelerate investment in organic growth, productivity initiatives, and disciplined strategic acquisitions while maintaining an investment-grade balance sheet.
The EMEA Packaging company is expected to pursue a strategy to become a leading European sustainable packaging provider, emphasizing innovative customer solutions, high-performance operations, and sustainability leadership. International Paper said the EMEA unit has begun executing its own 80/20 roadmap to optimize its footprint, reduce costs through structural changes, and increase reinvestment in innovation and service. The parent company said it plans to continue investing in the EMEA business in 2026 to advance these initiatives and prepare the unit for separation, with higher margins and improved free cash flow.
International Paper said the separation is expected to be structured as a spin-off of the combined EMEA Packaging business to shareholders, with International Paper intending to retain a meaningful ownership stake in the new company. The new company is expected to be listed on both the London Stock Exchange and the New York Stock Exchange. The company said that whether the transaction will be tax-free to shareholders for U.S. federal income tax purposes will depend on the ultimate terms, including the amount of shares retained.
The separation is expected to be completed in 12 to 15 months, subject to customary conditions, including final approval by International Paper’s board, the filing and effectiveness of a registration statement with the U.S. Securities and Exchange Commission, and publication of a prospectus approved by the U.K. Financial Conduct Authority. International Paper said additional details, including capital structure and the broader leadership team for the new company, will be announced later.
Management roles are expected to remain largely consistent through the transition. Andy Silvernail will continue as chairman and chief executive officer of International Paper, with Lance Loeffler remaining chief financial officer and Tom Hamic continuing as executive vice president and president of Packaging Solutions North America. For the new EMEA company, Tim Nicholls is expected to serve as chief executive officer, and David Robbie is expected to serve as chairman of the board.
Jefferies served as lead financial advisor to International Paper, with Evercore also acting as financial advisor. Wachtell, Lipton, Rosen & Katz served as legal counsel.
KEY QUOTES
“During the past year, we have created two regional powerhouses with scale, strong customer relationships, leading brands and talented teams. The two businesses operate in distinct market environments and are at different stages of their transformation. We have learned a lot about how to create value in each region. The next right step in our transformation journey to achieve full value creation potential is to create two independent, regionally focused companies. Taking this swift, decisive action now will enable both businesses to reach best-in-class performance and maximize long-term value creation through enhanced focus on their unique opportunities and targeted investment approaches.”
Andy Silvernail, Chairman and CEO, International Paper
