Key Highlights

  • SLVM shares rose 13.27% pre-market to $37.47 after closing at $33.08 on Nov. 5.
  • Sylvamo entered a Put Option agreement for a binding offer to acquire its Europe business.
  • The deal gives Sylvamo the right to receive 20% of future distributions.
  • Q3 continuing net sales were $645 million; adjusted EBITDA was $128 million.

Sylvamo (NYSE:SLVM) shares were up 13.27% pre-market at $37.47, compared with a Nov. 5 close of $33.08, after the company announced a put option agreement with Midas Atlantic Partners, in Partnership with The Najafi Companies, for a binding offer to acquire its Europe business. The company also released third-quarter 2026 results.

Sylvamo, based in Memphis, Tennessee, is a paper company with mills in Europe, Latin America and North America, focused on uncoated freesheet paper.

Europe Business Sale Would Bring a 20% Share of Future Distributions, With Closing Expected by End of Q1 2027

The Europe business includes uncoated freesheet paper mills in Saillat, France, and Nymolla, Sweden, as well as forestry and supporting business operations. Sylvamo will conduct consultation processes with works councils and employee representatives before making any final decision.

Once consultation is complete, the parties expect to enter into a definitive share purchase agreement transferring the business to Midas Atlantic Partners with an agreed level of Working Capital and cash, in exchange for the right to receive 20% of future distributions. Closing is expected by the end of the first quarter of 2027. CEO John Sims said Sylvamo would be a more focused company with greater ability to invest in its business, and that its long-term strategy is unchanged.

Continuing Operations Post $645 Million in Net Sales and $128 Million in Adjusted EBITDA

Net sales from continuing operations were $645 million, compared with $614 million in the second quarter and $662 million in the third quarter of 2025. Net sales of the European operations, reported in discontinued operations, were $178 million. Net Income from continuing operations was $85 million, or $2.13 per diluted share, a 13% margin. Adjusted operating Earnings were $53 million, or $1.33 per diluted share, and adjusted EBITDA was $128 million, a 20% margin.

Discontinued operations reported a $284 million loss, primarily driven by a noncash Impairment charge. Cash provided by Operating Activities from continuing operations was $70 million and free Cash Flow was $16 million. Sylvamo declared a Dividend of $0.45 per share, which was paid on Oct. 16.

Price and Mix Improve $25 Million as Eastover Investments Stay on Schedule

Versus the second quarter, price and mix improved by $25 million, primarily from previously communicated paper price increases, and Volume was relatively flat. Operations and other costs were favorable by $6 million, planned maintenance outage costs were $38 million lower, and input and transportation costs were unfavorable by $6 million.

The Eastover paper machine optimization project remains on schedule and within budget and will add 60,000 short tons of uncoated freesheet capacity annually. A new sheeter will add approximately 200,000 short tons of cutsize converting capacity, with startup expected early in the third quarter of 2027. Sylvamo has a forward P/E of 8.07, a trailing P/E of 17.56 and EPS of $2.02, and its 52-week range is $30.40 to $56.80.

Next Up: Works Council Consultations and a Definitive Agreement for the Europe Business

Sylvamo shares are higher pre-market after the announced plan to sell its Europe business and third-quarter results from continuing operations. Attention turns to the works council consultation processes, a definitive share purchase agreement and the expected closing by the end of the first quarter of 2027, along with progress on the Eastover investments.