Graphic Packaging (GPK) said it will create a $6B paper-based packaging company by forming a new partnership comprised of Graphic Packaging’s existing businesses and International Paper’s (IP) North America Consumer Packaging business. Graphic Packaging will own 79.5% of the partnership and will be the sole operator. International Paper will own 20.5% of the partnership, equivalent to a $1.14B value. The partnership will assume $660M of International Paper debt. There will be no change to Graphic Packaging’s current board or leadership team. The company said, “The transaction will be completed at a compelling EV/Adjusted EBITDA multiple of 8.6x, pre-synergies, and 6.3x, post-synergies. International Paper will have a 2-year lock-up on the monetization of their partnership interest and cannot purchase GPK shares for a period of 5 years, subject to limited exceptions.” It added, “”The $75 million in synergies is compelling and will be driven by cost reductions, increased paperboard integration, and procurement and mill efficiencies.” The transaction has been approved by the boards of both companies and is expected to close in early 2018. International Paper’s North America Consumer Packaging business is a $1.6B revenue producer of solid bleached sulfate paperboard and paper-based foodservice products. The business includes two SBS mills located in Augusta, Georgia and Texarkana, Texas with annual production capacity of 1.2 million tons of SBS, three converting facilities in the U.S. and one in the U.K.. The business is projected to generate Adjusted EBITDA of $210M in 2017.