MEMPHIS, Tenn. (News release) -- International Paper, a leader in sustainable packaging solutions, announced Jan. 29 its plan to create two independent, publicly traded companies: International Paper will be comprised of its current business in North America including both legacy IP and DS Smith assets, and the EMEA Packaging business will be comprised of both legacy DS Smith and IP assets in EMEA. The separation will create two leading sustainable packaging solutions companies, each with focused management teams and business models, tailored investment and capital allocation strategies, and compelling financial profiles.

"During the past year, we have created two regional powerhouses with scale, strong customer relationships, leading brands and talented teams," said International Paper Chairman and CEO Andy Silvernail. "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."

International Paper will Accelerate Value Creation Across North America
The separation will provide International Paper with the focus and targeted capital allocation strategy to strengthen its position as a leading sustainable packaging company in North America, focused on customers and leading on innovation, with an advantaged cost position. Comprised of IP's Packaging Solutions North America business, including both legacy IP and DS Smith assets, International Paper will continue to serve a wide range of industries with sustainable packaging solutions, designed to protect products, enhance supply chains and support customer sustainability goals.

After separation, International Paper will be even more focused, providing an even greater ability to accelerate its transformation strategy across North America. The company has already taken bold actions to streamline its footprint, decentralize operations, and optimize asset networks by deploying its lighthouse model across North America. IP will build on its progress by making investments that drive innovation and service, enhance quality, and bolster productivity.

Continued progress in North America will enable the company to compound earnings, grow cash flows, and deliver superior shareholder returns. Following the separation, International Paper intends to accelerate investment toward organic growth, productivity and disciplined strategic acquisitions, while maintaining a strong, investment-grade balance sheet.

Andy Silvernail will continue to serve as Chairman and CEO of International Paper, Lance Loeffler will remain Chief Financial Officer, and Tom Hamic will remain Executive Vice President and President, Packaging Solutions North America.

EMEA Packaging will Thrive with Increased Focus and Targeted Investment
EMEA Packaging will accelerate its path to being the leading European sustainable packaging solutions company, defined by best-in-class innovative customer solutions, high-performance operations, and sustainability leadership. Built specifically for EMEA, the standalone business will be a leading provider of innovative, sustainable packaging solutions focused on meeting evolving market demands, helping customers achieve their sustainability goals, and reallocating resources to drive innovation and enhanced service. Operating in 30 countries across EMEA, the company will be comprised of IP's current Packaging Solutions EMEA business, operating as DS Smith, which includes the combination of legacy DS Smith and IP assets.

During the past year, EMEA Packaging has begun executing its focused 80/20 roadmap to optimize its footprint, structurally reduce costs, extend its leadership in product and service innovation, and drive targeted reinvestments. Throughout 2026 and prior to the separation, International Paper plans to continue to invest in EMEA to further advance its 80/20 plans and prepare the business to separate with higher margins and improving free cash flow.

As an independent company, EMEA Packaging will be equipped to tailor its strategy and capital allocation to the specific characteristics of EMEA. The business will continue to execute its 80/20 roadmap while focusing on meeting evolving market demands, helping customers achieve their sustainability goals, and reallocating resources to drive innovation and enhanced service. The new company will have a robust investment grade balance sheet and dividend policy to enable strong operational delivery and the flexibility to engage in high-return organic and inorganic investments.

Following the separation, Tim Nicholls will serve as Chief Executive Officer of the new publicly traded company. Over the past year, Nicholls has served as Executive Vice President and President of DS Smith, an International Paper company. Nicholls and the rest of the EMEA leadership team, with deep collective industry and regional expertise, have led the integration and transformation of the combined EMEA business. Additionally, David Robbie is expected to serve as the Chairman of the Board of Directors of the new company in EMEA. Robbie served on the former DS Smith board as Senior Independent Director until joining the International Paper Board of Directors in 2025.

Transaction Details
The separation is expected to be structured as a spin-off of the combined EMEA Packaging business to shareholders. International Paper intends to retain a meaningful ownership stake in the new company. Whether the transaction will be tax-free to shareholders for U.S. federal income tax purposes will depend on the ultimate terms of the transaction, the amount of shares retained and other factors. The new company is expected to be listed on both the London Stock Exchange and the New York Stock Exchange.

The separation is expected to be completed in 12-15 months, subject to the satisfaction of certain customary conditions, including final approval by the IP Board of Directors as well as the filing and effectiveness of a registration statement with the U.S. Securities and Exchange Commission and the publication of a prospectus approved by the U.K. Financial Conduct Authority. No assurance can be provided regarding the ultimate timing or structure of the proposed separation or its eventual completion.

Additional details including capital structure and broader leadership team will be announced at a later date.

Advisors
Jefferies served as lead financial advisor to International Paper. Evercore also served as financial advisor to International Paper. Wachtell, Lipton, Rosen & Katz served as legal counsel to International Paper.