WestRock plans to acquire SP Fiber Holdings for $288 million

Paper producer also will acquire a stake in Green Power Solutions of Georgia.

  • August 11, 2015
  • Recycling Today Staff

WestRock Co., based in Norcross, Georgia, has announced it intends to acquire SP Fiber Holdings Inc., owner of SP Fiber Technologies, a producer of recycled containerboard and kraft and bag paper with mills located in Dublin, Georgia, and Newberg, Oregon.

WestRock is the entity formed in July following the January 2015 merger of MeadWestVaco Corp. and Rock-Tenn Co.

The producer of paper and corrugated packaging solutions says it has entered into a definitive agreement to acquire SP Fiber in a transaction valued at $288.5 million. As part of the deal, WestRock also will acquire SP Fiber’s 48 percent interest in Green Power Solutions of Georgia LLC (GPS). GPS is a renewable energy joint venture providing energy to Georgia Power and steam to the paper mill in Dublin.

“The Dublin and Newberg mills will balance the fiber mix of our mill system and the addition of kraft and bag paper will diversify our product offering,” says Steve Voorhees, chief executive officer of WestRock. “We expect to apply our operating capabilities to improve the cost structure of both mills. As a result, our mill system will be better positioned to serve the increasing demand for lighter weight containerboard and kraft paper.”

SP Fiber produces containerboard and kraft and bag paper for end use in consumer and corrugated packaging. Made from 100-percent-postconsumer-recycled fiber, these products have been certfied through FSC (Forest Stewardship Council), SFI (Sustainable Forest Initiative) and PEFC (Programme for the Endorsement of Forest Certification), WestRock says.

“We are thrilled to have the opportunity to supply the food service market with lighter-weight paper for recycled, unbleached bags. Adding this modern recycled containerboard and kraft paper production provides us with efficiencies in our mill system that will enable us to more effectively serve our customers,” says Jim Porter, president of paper solutions, WestRock.

According to WestRock, the transaction is expected to generate significant synergies and be accretive to earnings in the second half of fiscal year 2016. The transaction is subject to regulatory approval and will close after the regulatory process has concluded.