S&P Upgrades Packaging Corp. of America Credit Rating to BBB+

S&P Global Ratings has upgraded Packaging Corp. of America (PKG) from 'BBB' to 'BBB+'. The agency cited the company's management of leverage following a recent acquisition. This decision, announced on September 16, 2026, reflects the firm's ability to maintain leverage below 2.0x after its capital deployment.

"The upgrade reflects our expectation that Packaging Corp. of America will sustain adjusted debt to EBITDA below 2.0x, supported by disciplined financial policies and strong operational cash flow," according to an S&P Global Ratings report.

Impact of the Greif Acquisition

The improved credit profile follows the $1.8 billion acquisition of Greif’s containerboard business, which closed in September 2025. Packaging Corp. of America funded the transaction using several financing instruments:

• $1 billion in term loan proceeds
• $500 million in unsecured notes
• $300 million in cash reserves

The company is integrating these assets to improve its containerboard operations. Management projected that the acquisition will yield $60 million in annual synergies by the end of 2027. S&P analysts noted that these synergies support margin stability.

Financial Outlook and Leverage Targets

S&P maintains a positive outlook as the firm continues to deleverage its balance sheet. According to the agency's latest projections, Packaging Corp. of America's adjusted leverage should reach 1.7x by the end of 2026. The agency expects this figure to decline to 1.4x by 2027 as the company prioritizes debt repayment.

This credit upgrade affects the firm's capital structure, as higher credit ratings allow companies to access debt markets at lower interest rates. For stakeholders, the move indicates confidence in the company's ability to manage large acquisitions while maintaining financial health.