Mondi to buy Finland’s Powerflute in deal worth more than R5bn
Mondi is acquiring Finnish pulp and paper mill operator Powerflute for €365m from Nordic Packaging and Container Holdings, the Johannesburg-and London-listed packaging group said on Friday.
"The acquisition of Powerflute supports our strategy of investing in high-quality packaging and paper assets," Mondi CEO Peter Oswald said in the statement.
Powerflute will be integrated into Mondi’s packaging paper business unit. The transaction remains subject to competition clearance and customary closing conditions, and is expected to completed in the first half of 2018.
Powerflute’s mill is located in Kuopio and has an annual production capacity of 285,000 tonnes of "fluting" — the middle liner of corrugated board used to cushion the contents of cardboard boxes.
"Powerflute’s premium semi-chemical fluting is sold to a diverse range of customers, primarily for packaging fresh fruit and vegetables, but also other end-uses such as electronics, chemicals and pharmaceuticals. Around half of the company’s production is sold in Europe, while the remainder is exported globally," Mondi said.
For the year to end-December 2017, Powerflute is expected to generate about €183m revenue and €42m earnings before interest, tax, depreciation and amortisation.