JOHANNESBURG - South African producer of dissolving wood pulp and packaging papers, Sappi Limited, on Wednesday announced that it has fulfilled and completed all conditions precedent relating to the acquisition of the speciality paper business of Cham Paper Group.
Sappi had announced in December 2017 that it had signed an agreement to acquire the speciality paper business of Cham Paper Group for CHF146.5 million, or approximately $149 million.
The transaction includes the acquisition of CPG's Carmignano and Condino Mills in Italy, its digital imaging business located in Cham, Switzerland as well as all brands and know-how.
Sappi said that the main benefits of the acquisition include support of its diversification strategy and "2020vision" to grow in higher margin growth segments and the strengthening of its European specialities and packaging papers footprint and skills, which adds 160,000 tons of speciality paper to Sappi's capacity.
The acquisition is also earmarked to increase Sappi's relevance in specialities and packaging papers, opening up new customers and markets to Sappi’s existing products and generating economies of scale and synergies, and would add €183 million of sales and approximately €20 million of EBITDA before taking into account synergies.
Sappi chief executive, Steve Binnie, said that they were very pleased to have been able to finalise this acquisition so quickly.
"We are now able to move with speed to combine Cham's strong brands, employees and assets with Sappi's global presence. Our existing as well as new customers will benefit from a broader range of products coupled with our well-established excellent customer service," Binnie said.
"This transaction strengthens Sappi's specialities and packaging papers business both in Europe and globally, improves our profitability and is another significant milestone towards realizing our Vision2020 goal."