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Ahlstrom acquires remaining share of its JV in Brazil
29
Aug '08
Ahlstrom, a global leader in fiber-based materials, announced that it will acquire the remaining 40% of the joint venture formed in September 2007 with Votorantim Celulose e Papel (VCP).

The production facility located in Jacarei, Brazil manufactures specialty papers. Ahlstrom now owns 100% of the shares.

The acquisition is in line with Ahlstrom's strategy to expand its operations in the fast-growing markets in Brazil, Russia, India and China. The price for the acquisition is EUR 28 million.

The assets in the joint venture comprise a paper machine, and offline coater and extensive finishing equipment at the Jacarei plant, close to São Paolo.

The annual net sales are approximately EUR 100 million. The unit is part of Ahlstrom's Release & Label Papers business area and serves mainly the labeling applications and certain flexible packaging markets. Additionally, it produces coated and uncoated paper grades for other end uses.

The demand in the South American label paper market grew strongly during the second quarter of 2008. The global market for Ahlstrom's release and label papers is estimated to grow by 3-4% annually with double-digit growth rates seen in Latin America and Asia.

The Release & Label Papers business area's net sales accounted for approximately 17% of the Group's net sales in the second quarter of 2008.

"A strong foothold in the rapidly growing labeling and packaging markets in Latin America helps us to strengthen our position as the leader in the global specialty paper markets.

This acquisition will also strengthen Ahlstrom's opportunities to expand its glassine business outside Europe", comments Risto Anttonen, CEO of Ahlstrom.

The joint venture between Ahlstrom and Votorantim Celulose e Papel (VCP) was established in September 2007. It includes a specialty papers production facility located in the same site as the pulp mill of VCP in Jacarei, Brazil, close to São Paolo.

Ahlstrom held 60% and VCP 40% of the shares in the joint venture. The terms of the agreement included an option for Ahlstrom to purchase the remaining share in the joint venture held by VCP within two years from the original transaction. The total value of the acquisition is approximately EUR 110 million.

Ahlstrom Corporation

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