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Cape Town - International paper and packaging group Mondi [JSE:MND] announced on Friday that it has signed an agreement to acquire 100% of the remaining shares in Powerflute, a division of Nordic Packaging and Container Holding in a deal worth billions.
Dual-listed on the JSE and the London stock exchange, Mondi expects to complete the transaction in the first half of 2018, pending competition clearance and customary closing conditions.
Powerflute operates an integrated pulp and paper mill in Kuopio (Finland) with an annual production capacity of 285 000 tonnes of high-performance semi-chemical fluting. Its 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.
According to Mondi CEO, Peter Oswald, Powerflute supports the company's strategy of investing in high-quality packaging and paper assets. 'We are excited by this opportunity to expand our customer offering by further broadening our containerboard product range and geographic reach.”
Powerflute's generated revenue for the year ending December 31 2017 is expected to be around €183m with adjusted earnings before interest, tax, depreciation and amortisation of €42m, according to a statement.
Mondi, which has operations in more than 30 countries, and makes and sells consumer packaging and paper products as part of its Europe and International division's Packaging Paper business, will integrate Powerflute into Mondi’s Packaging Paper Business Unit.
At 11:24 on Friday Mondi's share price rose 0.71% to R226 per share.
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