Freedonia Analysts Weigh in on International Paper and Graphic Packaging's New Agreement

News provided by

Oct 30, 2017, 12:48 ET

CLEVELAND, Oct. 30, 2017 /PRNewswire/ -- Last week, International Paper announced that it was combining its consumer packaging business with Graphic Packaging's consumer packaging division. Despite the nearly identical names of these segments, the transaction is not just about being bigger. Rather, the new business, which will be nearly 80% owned by Graphic Packaging, will be created by dovetailing two complementary businesses.

The complementary nature of the deal not only extends to the blending of International Paper's strength as a producer of cartonboard and other paperboard grades and Graphic Packaging's position as a supplier of paperboard packaging, but also to the combined businesses' food and foodservice products. Freedonia packaging analyst Mike Richardson commented, "The compatibility of the two businesses is easy to see. IP's serviceware offerings like cups and plates fit together well with Graphic Packaging's line of takeout containers and items like bakery boxes used by retail stores."

As a result, the new business is likely to exert its new muscle in the retail food and foodservice packaging markets. Freedonia analyst Chad Henry, said "This deal creates a unit poised to take a bite out of the single-use foodservice products market, an industry forecast to be worth over $22 billion by 2021. International Paper has extensive offerings of paper cups for both beverages and food, while Graphic Packaging is well-established in containers for take-out food including pizza, chicken, and bakery items. The combined business will have the broadest range of paperboard foodservice products in the industry.

According to Henry, the increased trend toward away from home eating, hot and cold specialty beverages, and expanding take-out and delivery options will drive growth of around 4% per year for single-use foodservice items. The market is explored in-depth in the forthcoming industry study from The Freedonia Group, Foodservice Single-Use Products, available in December.

For more information about related studies go to the Packaging page featuring the titles:

Cups & Lids

Corrugated & Paperboard Boxes

Foodservice Disposables

Food Containers

About The Freedonia Group, a division of MarketResearch.com – The Freedonia Group is a leading international industrial research company publishing more than 100 studies annually. Since 1985, we have provided research to customers ranging in size from global conglomerates to one-person consulting firms. More than 90% of the industrial companies in the Fortune 500 use Freedonia Group research to help with their strategic planning. Studies can be purchased at www.freedoniagroup.com, www.marketresearch.com and www.profound.com.

Press Contact:
Corinne Gangloff
+1 440.684.9600
[email protected]

SOURCE The Freedonia Group