Pulp Paper & Logistics
INDUSTRY NEWS 7
UPM restructures in response to declining graphic paper demand
operations in Europe and North America. In Europe, the Finland-based
I
paper maker is planning to ‘streamline’ internal processes and invest in automation at its UPM Nordland Papier and UPM NorService units in Dörpen, Germany, Europe’s biggest fine paper site to enable sustainable improvement of its fixed cost structure. In North America UPM will shut
down its PM5 machine at UPM Blandin in Minnesota reducing the mill’s annual capacity by
n response to the declining global market for graphic papers, UPM Paper is restructuring its
savings of €30 million, says UPM. “During the last years the
UPM’s Winfried Schaur: “We have to adjust our operations to prospective customer demand”
about 128,000 tons of coated magazine paper.
The changes will cost about €35 million and result in annual
demand for graphic papers has been declining – and the decline is expected to continue,” said Winfried Schaur, executive vice president of UPM Paper ENA. “Our employees have always given their best, even under challenging market conditions, and we regret the impact of the planned measures on our personnel in Dörpen and Blandin. However, we have to adjust our operations to prospective customer demand and continuously improve our operations to safeguard the success of UPM Paper ENA in the long run.”
IP’s paper-based consumer packaging business merged with Graphic Packaging
A paper-based packaging company with yearly sales of about US$6 billion is being created by a partnership in which Graphic Packaging’s existing businesses will be merged with International Paper’s North America Consumer Packaging business. Graphic Packaging Holding Co
will be the operator, retaining its management team, and own 79.5 per cent of the partnership, which will take on $660 million of IP’s debt. International Paper’s North America Consumer Packaging produces solid bleached sulphate (SBS) paperboard
and paper-based foodservice products with global sales of $1.6 billion a year. The business includes two SBS mills, in Augusta, Georgia and Texarkana, Texas, with annual capacity of 1.2 million tons, three converting facilities in the US and one in the UK, with capacity to convert 250,000 tons of SBS paperboard into more than 24 billion units of paper-based cups and cylindrical containers. “We are excited about the
platform for future growth created by this combination,” said Graphic Packaging’s chief executive Michael Doss. “We
expect the transaction will significantly increase our mill production and converting scale, meaningfully increase our exposure to the growing foodservice market, provide significant runway to realize synergies, and drive strong financial results. “The $75 million in synergies
is compelling and will be driven by cost reductions, increased paperboard integration, and procurement and mill efficiencies.” IP will have a 20.5 per cent
share of the business, worth $1.14bn. Mark Sutton, chief executive of International Paper,
said: “After evaluating a range of strategic options, we believe this transaction represents excellent value for IP’s shareholders. “Investing in Graphic Packaging
gives IP the opportunity to benefit from a much stronger value-creation consumer packaging platform, while allowing us to remain focused on growing value in our core businesses. Our North America Consumer Packaging business has a talented team, very good assets and great customers, and I am confident of the results the combined business will achieve.” The transaction is expected to close in early 2018.
November/December 2017
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36
