Midwest Paper mill sold to Mexico’s Bio Pappel

Evanston, Illinois-based Industrial Opportunity Partners (IOP) says it has completed the sale of Midwest Paper Group Holdings Inc. to McKinley Paper Co., a subsidiary of Mexico-based Bio Pappel S.A. de C.V.

Midwest Paper is a maker of recycled-content containerboard for corrugated packaging and recycled-content kraft bags that operates from a 1.2 million-square-foot paper mill located in Combined Locks, Wisconsin.

The move represents another growth step for Bio Pappel in the United States, where it has been adding and acquiring facilities for the past several years via its McKinley Paper business unit.

IOP, which acquired Midwest Paper in December 2019, says the divestiture represents the first “investment realization from its $450 million third fund, Industrial Opportunity Partners III L.P.”

“We’re pleased with what the company accomplished during IOP’s ownership period,” says IOP Operating Principal Dave Mackin, who served as Midwest Paper’s Interim CEO and chairman of the board during IOP’s stakeholder period. “The Midwest Paper team successfully executed IOP’s investment operating plan, which included commercial initiatives and operational improvements that turned a once struggling paper mill into a thriving business.”

Kyle Hood, managing director of IOP, comments, “We’re proud to have invested in a company that we believe advances environmentally friendly products, and we would like to thank the entire management team and workforce at Midwest Paper for their commitment and efforts throughout the company’s partnership with IOP. We believe Midwest Paper is poised for continued success under Bio Pappel’s ownership.”

Deloitte Corporate Finance acted as financial advisor and McDermott Will & Emery LLP provided legal representation to IOP and Midwest Paper in connection with the sale transaction.