(Reuters) -International Paper said on Thursday it will sell its global cellulose fibers business to private equity firm American Industrial Partners for $1.5 billion.

The deal, expected to close by end-2025, is part of its strategy to focus on sustainable packaging solutions.

The divestiture comes months after the company's $7.2 billion acquisition of UK rival DS Smith.

Shares of International Paper were up about 1% in early trading.

Separately, the packaging products maker announced a $250 million investment to equip its Riverdale mill in Selma, Alabama, to produce containerboard. The changes are expected to impact about 1,100 hourly and salaried positions.

It also said the company was permanently closing its facilities in Savannah and Riceboro in Georgia.

(Reporting by Neil J Kanatt in Bengaluru; Editing by Devika Syamnath)