International Paper (IP) is closing some of its business operations in Georgia by the end of September.
The Savannah packaging facility, the Riceboro containerboard mill, and the Riceboro Timber and Lumber mill will all be permanently closing. The company cited a series of “strategic changes” as the reason for closing down the plants to maintain its “ongoing transformation journey.”
The move is part of an agreement between IP and American Industrial Partners (AIP) to sell its Global Cellulose Fibers (GCF) business for $1.5 billion, a deal expected to close by the end of the year pending regulatory approvals.
Tom Hamic, Executive Vice President and President of International Paper’s North America Packaging Solutions business, said in a statement the company understands how the closures will affect employees and the wider community.
“We are committed to supporting both our employees and customers as we navigate this transition,” Hamic said. “While difficult, these decisions are essential to positioning International Paper for long-term success, enabling us to focus on the geographies, customers, and products where we can create the most value.”
The closures will result in approximately 1,100 hourly and salaried jobs being nixed. The company is offering severance packages and the outplacement of eligible employees, according to a press release.
“GCF is a strong business, and I’m pleased to see it transitioning to AIP, which is focused on investing in and growing industrial businesses,” said IP Chief Executive Officer Andy Silvernail. “Over the past few months, GCF has done the hard work of aligning resources with its most strategic customers, implementing an 80/20 mindset, and creating a simplified and focused portfolio.”
In a press release, Georgia House Speaker Jon Burns, Newington Republican, expressed his concerns over the closure.
“I am deeply disappointed to hear this morning’s news regarding International Paper’s plant closures in Savannah and Riceboro,” Burns said. “As a fifth-generation timber farmer myself, I understand firsthand the challenges of facing changing markets and economic instability. These mill closures will undoubtedly deal a devastating blow not only to Georgia’s timber industry, but to the economic fabric of the entire Southeast Georgia region.”
Burns noted that he will work with the Legislature, federal partners, and timber producers to assist those affected by the closures, including helping to secure new employment opportunities.
