Mondi wraps up Powerflute deal for Christmas

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Mondi wraps up Powerflute deal for Christmas

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Published Date: 2017-12-27 | Source: Stephen Gunnion | Author: Stephen Gunnion

Mondi wraps up Powerflute deal for Christmas

The pulp and paper group says it hopes to wind up its acquisition of the corrugated packaging specialist in the first half of next year

Mondi is buying Powerflute Group, a division of Nordic Packaging and Container, for €365 million.

Powerflute operates an integrated pulp and paper mill in the Finnish city of Kuopio, 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 for fresh fruit and vegetables, but also other end-uses such as electronics, chemicals and pharmaceuticals. Around half of the company's production is destined for Europe, while the rest is exported globally.

The company was expected to generate revenue of around €183 million and unaudited pro-forma adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of around €42 million. Mondi will integrate Powerflute into its Packaging Paper business unit.

"The acquisition of Powerflute supports our strategy of investing in high-quality packaging and paper assets," Mondi CEO Peter Oswald said in a statement. "We are excited by this opportunity to expand our customer offering by further broadening our containerboard product range and geographic reach."

The deal is still subject to competition clearance and is expected to be completed in the first half of next year.

Shares in Mondi gained 0.8% to R321.49 on Friday.



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