Arjowiggins has announced the planned sale of Arjowiggins Graphic and Arjowiggins Creative Papers to Fineska BV, the parent company of Eska Group, the renowned Dutch-based graphic cardboard business controlled by Andlinger & Company, a private investment group which also owns Crown Van Gelder (CVG), a Dutch specialty papers manufacturer.
Information and consultation procedures have been initiated with the relevant work councils and the planned sale will be submitted for approval by the national competition authorities in all countries where it is required. The transaction is expected to complete by the end of October 2018.
The gross amount of the transaction should be €125 million. Given the companies’ debts and other liabilities, net proceeds from the sale should be in the region of €20 million (to be adjusted at completion of the transaction in line with balance sheet items).
The businesses to be divested reported sales of €528 million in 2017, or 19% of Sequana Group’s consolidated sales, of which 61% comprised recycled graphic and specialty (i.e., laminated and transfer) papers and 39% premium fine papers and specialty papers (i.e., bookbinding and tracing paper). They operate a total of eight mills located in France, the UK, Spain and China and employ over 2,000 people. In the wake of the major restructuring operations carried out in 2014 and 2015 to refocus on specialty papers, these two divisions generated positive cash-flow in 2017 and they should report a profit in 2018.
Following a competitive bidding process that was part of Sequana’s strategy of weighing up its options and playing its part in the necessary consolidation of the paper industry, Sequana’s Board of Directors has chosen Fineska’s offer. This operation, which is satisfactory for Sequana, would also safeguard the future development of Arjowiggins Graphic and Arjowiggins Creative Papers within a private investment group that has been supporting CVG and Eska – two renowned players in the specialty papers and graphic cardboard sectors – for a number of years.
This transaction is a major milestone for Sequana that would mark its exit from all paper manufacturing activities with the exception of Arjobex. Since 2008, Sequana has been refocusing on its paper distribution business where its subsidiary Antalis boasts leading positions in Papers, Industrial Packaging and Visual Communication in Europe.