AICC Boxscore 2013

TECHNICAL CORNER

Some Corrugated and Containerboard History: Part One By Ralph Young

Paper Company for the top spot in the industry in terms of pulp and paper tonnage produced.

the break-up of the San Francisco- based forest products corporation in May 1986. The more profitable manufacturing assets (fine paper mills) were sold to the James River Corporation of Richmond, Virginia (which became Fort James in 1997, and was acquired by Georgia-Pacific in 2000). The less profitable container division (brown paper) became “Gaylord Container,” and after a brief period as a limited partnership, was sold in November 1986 for $260 million to a group of Midwest investors led by Warren Hayford and Marvin Pomerantz They headed Mid- America Packaging, a single kraft paper mill in Pine Bluff, Arkansas, acquired from Weyerhaeuser in December 1985 for $28 million. Soon after the acquisition of the former Crown Zellerbach assets, the headquarters of Gaylord Container were moved from California to Illinois. The company was originally named after the Gaylord container, a bulk- size corrugated box by a company of the same name, based in Gaylord, Michigan. The company was acquired by Crown Zellerbach in 1955, which renamed its brown paper operations the “Gaylord Container Division.” In 2002, Inland acquired the Gaylord Container Corporation. Container Corporation of America: CCA was founded in 1926. In 1968, CCA merged with Montgomery Ward & Company, Inc., in a move that was largely intended to thwart takeover bids against either company. continued on page 52 17 BOX SCORE 51

This summer an associate member that was taking on new salespeople outside our industry used ASKRalph for his recollections of mergers, acquisitions, and consolidations during the last thirty years. So for those of you who are new to this industry we submit this legacy for you. For those of us that are veterans, a few memories. Please feel free to correct or add information and we will update this genealogy with your input in Part Two of this series. Ours is a rich history of single entrepreneurs and partners taking risks in very local venues. The beginnings were not corporations; it was very fragmented and very independent. It might have been as simple as a straw farmer seeking a higher return on his crop (an early fibre source for medium) than as a feedstock for cattle. And, he would partner with paper maker and a box manufacturer that was moving out of wooden crates into corrugated “packaging.” It is only over the years that larger and more geographically focused companies came to acquire the local and regional business operations. St. Regis: On August 1, 1984 The Champion International Corporation and the St. Regis Corporation announced jointly that they had signed a definitive agreement to merge the two big paper companies in a deal valued at $1.7 billion in cash and stock. The merger would create the nation’s biggest paper producer in terms of sales, far outstripping the Georgia-Pacific Corporation, the current leader. It would also challenge the International

St. Joe: The paper mill at the corporate headquarters in Florida was

most profitable in the 1960s with products being directly marketed to independents, trade partners, and company owned box plants. However, an extended period of down time (9-months) due to market conditions in 1996 signaled the beginning of the end for the mill. After nearly sixty years, St. Joe decided to get out of the paper business. The mill was sold in 1996 to Florida Coast Paper for $390 million and was able to operate and produced paper until another decline of the container board market. The mill closed August 16, 1998 and did not reopen. The mill was gone by 2003. In November 1995 St. Joe announced a deal to sell 16 box plants and its pulp and paper mill for $390 million, taking a big step to divest its noncore assets. Box USA, owned by the Four M Corporation of Valhalla, N.Y., the largest privately held corrugated box maker in the nation at that time, acquired the East Coast box plants. It is also bought the pulp and paper mill in Port St. Joe, Fla., in a joint venture with the Stone Container Corporation of Chicago. After the sales, St. Joe Paper is left with one million acres of forest land and property in Florida, among other assets. Gaylord Gaylord Container was a by-product of the hostile takeover of Crown Zellerbach by Sir James Goldsmith in July 1985, which resulted in