Why Sappi bought speciality paper business in Europe
The company wants to reduce dependence on traditional graphic paper
Sappi’s acquisition of a speciality paper business in Europe will help the company to reach its target of deriving a quarter of profits from speciality paper by 2020, says CEO Steve Binnie. But an analyst said on Tuesday he was surprised that Sappi was spending cash on a speciality paper acquisition when its most pressing need was for a dissolving wood pulp deal. Sappi said it would buy Cham Paper Group’s speciality paper business — consisting of two mills in Italy and a digital imaging business in Switzerland — for about $149m (R2bn). "We set ourselves a target of getting our specialities and packaging business to 25% of profits by 2020, and with this acquisition and the two conversion [projects] we should be pretty much there," Binnie said. Sappi is converting a mill in the Netherlands to focus mainly on speciality paper and packaging and is investing in a paper packaging production line in the US. This followed a similar conversion project in Germany that had been "extremely succ...
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