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- Date:
1/3/2009
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Sappi Limited on Dec. 31 completed the acquisition of the coated graphic paper business of M-real for Euro 750 million ($1.1 billion; R8.9 billion), subject to purchase price adjustments for net debt and working capital.
M-real's coated graphic paper business (other than in respect of M-real's South African business), including brands and four coated graphic paper mills – Kirkniemi and Kangas in Finland, Stockstadt in Germany and Biberist in Switzerland – have been integrated into Sappi Fine Paper Europe operations.
As of Jan. 1, 2009, M-real's Husum PM8 Mill in Sweden and Aanekoski PM2 Mill in Finland are contract producers for Sappi under supply agreements. Long term supply agreements for wood, pulp and other services have also taken effect, Sappi said.
The deal was financed through a combination of equity, assumed debt, the cash proceeds from a fully subscribed rights offering and a vendor note.
The acquisition increases Sappi's European graphic paper capacity from 2.6 million tpy to 4.5 million tpy.
Sappi said that it expects total annual synergies of approximately Euro 120 million, which should be realizable in full within three years and without material capital investments.
SOURCE: Sappi