WestRock's Strategic Overhaul Should Unlock Value Despite Near-Term Packaging Headwinds

WestRock manufactures corrugated packaging and consumer packaging products, such as folding cartons and paperboard. It accounts for roughly 20% of the North American containerboard market and is the second-largest producer. WestRock was formed from the 2015 merger of RockTenn and MeadWestvaco, which combined two of the largest containerboard and paper companies in North America. WestRock’s formation is a result of a decade of consolidation in the containerboard industry, where four players now account for over 70% of the previously fragmented market. During this time of consolidation, producers were able to raise prices and expand margins, but increased competitive intensity and rising input costs have weighed on profitability in recent years.