SWEDEN - Ahlstrom-Munksjö has signed a letter of intent with the majority shareholders of Hebei Minglian New Materials Technology Co., Ltd. to acquire the company, comprising a state-of-the-art greenfield decor paper plant in the city of Xingtai, Hebei Province, China.
The debt free purchase price is approximately EUR 60 million. The letter of intent contains customary exclusivity undertakings on the part of the sellers with respect to the considered transaction.
Minglian New Materials was established in 2016 by a group of experienced entrepreneurs with a background in the Chinese decor industry through a greenfield investment in new state-of the art paper machine technology and plant lay-out. The production started at the end of 2018 and the ramp-up has progressed well. The machine capacity is 50,000 tons per year.
The Decor business area is one of Ahlstrom-Munksjö’s five reporting segments, with net sales of EUR 451.9 million and comparable EBITDA of EUR 37.1 million in 2018. The Decor business produces paper in a wide range of colors, grades and grammages for decorative applications, mainly used in laminated furniture, flooring and interior applications both for technical and esthetical purposes. The production takes place at five plants: Unterkochen and Dettingen in Germany, Tolosa in Spain, Caieiras in Brazil and Arches in France. Annual production capacity is approximately 230,000 tons.