Corrugated Sheet and Box Production – October 2025 M&A Activity

SOURCE - The Target Report

In 1856, tall top hats were the height of fashion for men. Two English gentlemen in the hatter trade, Edward G. Healy and Edward E. Allen, resolved to find a material that would maintain the tall shape, yet was flexible to fit individual noggins. The solution they arrived at was to form paper into pleats, giving it a wavy shape for strength. They fed paper through a very simple hand-cranked machine that had two intersecting fluted rollers, typically used to create ruffled fabric, such as on collars or cuffs. They patented the invention in England, but never made the leap to using their invention to create a shipping box.

American ingenuity was behind the next step forward in the form of a US patent filed in 1871 by Albert L. Jones for “an improvement in paper for packing,” which described the use of “corrugated or crimped sheet of paper to one side of which is attached a flat sheet of paper by pasting” to create an effective cushion for the contents being packed. A common use was to wrap the corrugated paper around fragile items such as bottles or kerosene lamp chimneys.

Three years later, a machine was developed for producing large quantities of corrugated material. That same year, another inventor, Oliver Long, added a liner sheet to the second side, trapping the corrugation in the middle and producing the corrugated material we know today. In 1894, the first corrugated box was manufactured in the US. The cheaper product quickly replaced the previously dominant wooden crates and boxes used to ship products.

Corrugated’s Long Boom

For the past decade, the corrugated packaging sector has stood apart from the ups and downs of the broader general commercial print industry. Corrugated production surged before, during, and after the Covid pandemic shutdown. Every click by an online shopper echoed down the supply chain to a box converter, corrugated sheet production line, kraft linerboard mill, and yes, even to the loggers bringing in the raw timber for pulp. Business was good, which drove a steady stream of mergers and acquisitions.

As we observed as far back as 2015, the transactional activity in the manufacturing of boxes of all sorts was brisk, unlike its troubled cousin, commercial printing. Not only was the box far less susceptible to disruption by the transition of content to online sources, but the inherent recurring nature of packaging production also made the entire box supply chain desirable for investment. (See The Target Report: The Box is in Demand – October 2015.)

Three years later, we chronicled how the sector shed its image as a mature commodity business. At that time, the CEO of DS Smith (now merged into International Paper), commenting on the company’s acquisition, exclaimed that the corrugated segment was “an exciting and fast-paced environment where we are experiencing strong momentum.” (See The Target Report: Corrugated Gets Glam - May 2018.)

The enthusiasm for the corrugated box business continued unabated at the local supplier level with consolidators such as Welch Packaging. The company executed one acquisition after another in its laser-focused campaign of acquiring family-owned corrugated box companies. (See The Target Report: Catching the Wave in Corrugated Cartons – February 2020.)

The Covid pandemic certainly did not cool acquirers’ ardor for the corrugated business. In a classic bidding war that played out globally in the public markets, International Paper announced in April 2024 that it had prevailed over Mondi in the competition to land DS Smith. The industry was in a full-scale frenzy of roll-ups and consolidation plays. (See The Target Report: Corrugated Consolidation – June 2024.)

Corrugated Sheet and Box Producers Hit the Brakes

Now the story has turned. The Wall Street Journal reported in September 2025 that U.S. box shipments had fallen to their lowest levels since 2016 and that nearly nine percent of domestic containerboard capacity had gone offline within eight months. The Journal article stated that this was an unprecedented and sudden decline that represents roughly twice the capacity lost during the 2009 recession. The M&A and plant closure data from October confirms what many operators already feel: the corrugated market has entered an uncompromising correction phase. In October, corrugated producers announced the closure of four plants.

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