The global producer of dissolving wood pulp, speciality and packaging recently announced that it had signed an agreement to acquire the speciality paper business of Cham Paper Group Holding (CPG) for approximately US$149 million. The transaction includes CPG’s Carmignano and Condino mills in Italy, its digital imaging business located in Cham, Switzerland and all the company’s brands and know-how. It will be funded through internal cash resources. The transaction is conditional on the approval from certain competition authorities. Completion of the acquisition is expected during the first calendar year of 2018.
The main benefits of the acquirement include:
- support of Sappi’s diversification strategy and 2020 vision to grow in higher margin growth
- strengthens Sappi Europe’s speciality and packaging papers footprint and skills. The acquisition will add 160 000 tonnes of speciality paper to its capacity
- increases Sappi’s relevance in speciality papers, opening up new customers and markets to Sappi’s existing products and generating economies of scale and synergies
- gaining greater share-of-wallet with valued brand owners; accelerating innovation and new product development
- improved near-term profitability and serve as a platform for organic growth and further acquisitions. This procurement will add €183 million of sales and approximately €20 million of EBITDA before taking into account synergies
- builds on the investments currently underway to increase speciality paper capacity at Sappi’s Somerset, Maastricht and Alfeld mills
- unlocks the growth potential of the CPG speciality paper business.
‘This acquisition further strengthens Sappi’s speciality paper business in Europe and globally by combining Cham’s strong brands and assets with Sappi’s global reach. This transaction will increase profitability and unlock the significant growth and innovation potential inherent within the speciality paper market. I am very pleased that we have taken another signification step towards realising our Vision 2020 goal,’ says Steve Binnie, CEO of Sappi Limited.
Berry Wiersum, CEO Sappi Europe says the products and brands which have been acquired are an excellent complement to Sappi’s market offering.
‘It enables us to offer our existing, as well as new customers in Europe, North America and globally, a broader range of products coupled with excellent customer service.’
The speciality paper business of CPG will continue to operate separately and independently from Sappi until clearances from the authorities are obtained.