International Paper Co., based in Memphis, Tennessee, announced plans to close two paper mills in Georgia, including one that has been a cornerstone of Savannah’s economy for 90 years. The closures will affect approximately 1,100 jobs.
The company will stop making cardboard at its mills in Savannah and Riceboro by the end of September. In Savannah, about 800 employees will be laid off, while about 300 employees in Riceboro will lose their jobs. The announcement comes as part of the company’s effort to focus on its packaging business.
International Paper also plans to sell its pulp division to a private equity firm for $1.5 billion, and invest $250 million to expand cardboard production at a mill in Selma, Alabama.
The closures are expected to reduce International Paper’s containerboard capacity by 1.43 million tons and result in a $700-900 million accounting charge. The company will spend an estimated $158 million on severance payments and closure costs.
Savannah Mayor Van Johnson expressed “devastation and disappointment” over the decision, while Georgia state House Speaker Jon Burns said the closures will have far-reaching effects on the timber industry and regional economy.
The two mills in question were built in the mid-1930s by Union Bag and Paper and opened in 1968. The closure of these mills is part of International Paper’s effort to simplify operations and increase sales and profit.
Source: https://apnews.com/article/international-paper-georgia-closure-savannah-2b8bc6a99e4ca42de5ceb114c1ee2e0e