Packaging Corporation of America (PCA) has announced the $1.8 billion acquisition of Greif’s corrugated packaging division, boosting its production capacity and expanding its U.S. footprint.

Packaging Corp of America acquires Greif's corrugated business for $1.8B

Packaging Corporation of America (PCA) made headlines this week following its announcement of a $1.8 billion acquisition of Greif Inc.’s corrugated packaging business — a move that sent its shares soaring by nearly 7% and signaled a strategic reshaping of the U.S. packaging landscape.

The deal, set to close by the end of PCA’s third fiscal quarter pending regulatory approvals, involves the purchase of two containerboard mills with a combined annual production capacity of approximately 800,000 tons, as well as eight corrugated operations including sheet feeder and box plants. For PCA, this acquisition isn’t just a financial investment — it’s a bold strategic expansion designed to fortify its national footprint and boost efficiency across the value chain.

"This acquisition promotes PCA’s strategy of profitable growth," stated PCA CEO Mark Kowlzan. "The facilities complement our existing network and will supply containerboard for continued corrugated product growth."

The Greif assets generated $1.2 billion in revenue and $212 million in EBITDA over the trailing 12 months ending April 30, 2025. The transaction values the business at a multiple of 8.5 times EBITDA, or 6.6 times including anticipated pre-tax synergies of roughly $60 million. PCA expects to achieve half of these synergies within the first year, primarily through operational optimization, integrated logistics, and reduced freight costs.

To finance the deal, PCA plans to deploy $1.5 billion in new debt alongside cash on hand. Post-transaction, the company’s leverage ratio will be approximately 1.7x — a manageable figure that reflects its confidence in the value-creating nature of the acquisition.

Meanwhile, Greif is positioning the divestiture as a portfolio refinement. CEO Ole Rosgaard highlighted the move as a key milestone in Greif’s “Build to Last” strategy, unlocking immediate value for shareholders and enabling a tighter focus on core operations such as industrial packaging.

The implications of this transaction stretch far beyond corporate balance sheets. As industry consolidation intensifies, companies like PCA are proactively aligning their manufacturing capacity and supply chain integration to meet growing demand in ecommerce, consumer goods, and industrial sectors. The acquisition significantly enhances PCA’s access to domestic corrugated supply and is expected to improve customer responsiveness through increased geographic proximity.

Moreover, by absorbing Greif’s corrugated infrastructure, PCA not only gains access to new customers but also strengthens its position in a tightening containerboard market marked by rising input costs and regulatory scrutiny. The added scale will allow PCA to invest more confidently in sustainable packaging innovations and automated manufacturing systems.

For Greif, the deal represents a strategic exit from a non-core segment, while maintaining focus on its global leadership in rigid industrial packaging. Investors responded positively to the news, with Greif shares rising 4.4% post-announcement.

Ultimately, this transaction reflects a packaging sector in flux — one where vertical integration, operational efficiency, and geographic reach are crucial levers for profitability. As the industry continues to adapt to sustainability pressures and shifting consumer habits, moves like PCA’s acquisition of Greif’s corrugated business will likely set the tone for further consolidation and innovation across the packaging value chain.


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Keywords

packaging , acquisition , containerboard , PCA , Greif

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