Private vs. Public: How US Tissue Capacity Is Shifting

For decades, the US tissue and towel industry was dominated by large, publicly traded corporations. Names like Kimberly-Clark, Procter & Gamble, and Georgia-Pacific were practically synonymous with household paper products.

Over the past two decades, something notable has been happening beneath the surface. There has been a quiet shift in who controls production capacity.

Figure 1, which tracks both actual and announced US tissue and towel capacity from 2007 to 2027, reveals a compelling trend. Private companies have steadily grown their share of the market, eventually rivaling and even surpassing their public counterparts.

ANALYZING THE CHART

For the first 11 years in the chart, public companies held a slight, yet nearly consistent, lead in US tissue capacity. However, over the last seven years, the story begins to evolve.

In 2018, we begin to see the share of capacity held by private companies inch upward. What starts as a subtle increase turns into a pronounced shift. By the time we reach 2024, private companies have a clear dominance in the capacity produced in the US, with a nearly six percent increase from 2023 to 2024. Based on announced capacity, we expect slight growth in private capacity from 2025-2027.

PUBLIC VS. PRIVATE: KEY DIFFERENCES

While both public and private companies contribute significantly to the US tissue and towel market, their structures, priorities, and strategic approaches often differ in meaningful ways. Public companies are owned by shareholders and operate under strict regulatory oversight, including quarterly earnings reporting and public disclosure requirements. This structure can place greater emphasis on short-term financial performance and shareholder returns.

In contrast, private firms—often family-owned or backed by private equity—have more latitude in setting long-term strategies without the same level of external scrutiny. Some other differences include:

• Capital allocation and investment strategy: Public firms typically allocate capital based on a combination of global strategy and investor expectations, often focusing on margin expansion, scalability, and shareholder value. Private companies may prioritize reinvestment in regional assets, targeted growth, or operational improvements that don’t always align with public market pressures.
• Operational flexibility: Private tissue producers often operate with leaner management structures and fewer layers of bureaucracy. This allows them to act more quickly on market opportunities, tailor operations to specific customers or regions, and innovate in areas like private label production or sustainability.
• Market focus: Public companies tend to have broader brand portfolios and a stronger emphasis on national brand recognition. Private companies are frequently more involved in the production of private label products, which have seen increased demand due to pricing advantages and quality improvements.

These structural distinctions can help explain why private players have been able to steadily grow their market share.

WHAT’S DRIVING THIS SHIFT?

Several forces are likely at play when it comes to factors contributing to this shift:

• Divestitures and strategic refocusing: Public companies have, in many cases, restructured their portfolios to focus on higher-margin or globally scalable operations. That means divesting regional assets or less strategic mills—many of which were snapped up by private companies or private equity firms eager to enter or expand in the sector.For example, in 2024, Clearwater Paper announced the sale of its tissue business to Sofidel America Corporation for US$1.06 billion. The move was part of Clearwater’s strategy to concentrate on its paperboard operations. Meanwhile, Sofidel—a privately held global tissue producer—capitalized on the opportunity to expand its North American footprint. This transaction highlights how private players are seizing growth opportunities as public companies streamline their focus.
• Private investment surge: Tissue remains an attractive market: stable demand, relatively recession-resistant, and increasingly open to innovation in both sustainability and premium products. Private equity and family-owned firms have capitalized on these trends. They have invested significant capital in new mill builds or acquiring existing facilities.This wave of private investment also aligns with the growing strength of private label brands in North America. While the US has led the way in private label adoption, Canada is also now catching up. Store brands are gaining more shelf space and improved customer trust.

  This shift presents a strategic opportunity for privately held tissue producers. These companies are often well-positioned to support the needs of large retailers looking to expand or preimmunize their own branded tissue lines.

• Agility and specialization: Private companies often enjoy more flexibility and speed when adapting to changing market conditions. They can specialize in niche products, regional strengths, or faster supply chains. Doing so enables them to compete effectively with much larger corporations.Private firms often operate at lower costs. With leaner structures, less corporate overhead, and greater flexibility, they can focus on efficiency and long-term gains. These advantages make them ideal partners for retailers expanding private label programs, especially as store-brand demand rises.

WHAT COULD THIS MEAN FOR THE INDUSTRY?

This shift in ownership structure has important implications, including:

• More diverse competitive landscape: As more players enter or expand within the private space, we can expect increased competition—not just in price, but in innovation, service, and sustainability practices.
• Changing supply chain dynamics: With a broader array of producers, tissue buyers (retailers, wholesalers, and institutional clients) have more sourcing options, potentially reducing reliance on a few dominant names.
• M&A activity ahead: With the growing number of strong private firms, we could see further mergers, acquisitions, or IPOs, especially as private equity looks to cash in on investments or scale operations even further.
• Challenges for public giants: While public companies retain significant scale, they may find themselves challenged by more nimble competitors that can undercut prices or offer tailored solutions.
• Transition to store and club brands: Consumers are shifting more from traditional national brands to store-brand and club-brand tissue products, drawn by improved quality and better pricing. This trend puts pressure on national brand producers while creating major opportunities for private manufacturers who can deliver on cost and customization.

SUBTLE SHIFTS, STRATEGIC IMPACTS

While the shift from public to private ownership in the US tissue and towel industry is notable, it represents an evolution rather than a disruption. Private companies have gradually increased their share of capacity through strategic acquisitions, targeted investments, and operational flexibility. These changes are shaping a more varied competitive landscape, offering retailers and buyers more options and encouraging innovation across segments.

For now, public firms still remain influential, but they will need to adapt to a market that is slowly becoming more decentralized and dynamic. As this trend continues, modest shifts in supply chain dynamics, brand strategies, and investment priorities are likely to unfold, subtly redefining how capacity is built and deployed across the sector.