Sappi & Potlatch Transaction Finalized for Printing Papers
Press release from the issuing company
JOHANNESBURG, South Africa--May 13, 2002--Sappi Ltd, the world's largest producer of coated fine paper, today announced today that it has met all the required legal and regulatory requirements in connection with its purchase from Potlatch Corporation of its printing papers division as well as the Cloquet pulp and paper mill in Duluth, Minnesota.
The transaction was therefore completed on May 13, 2002.
Initial calculations indicated that this transaction would provide Sappi with synergies and savings amounting to approximately US $120 million per annum once the business is fully integrated. Sappi Chairman, Eugene van As, confirmed on May 7, 2002, during Sappi's 2nd quarter results announcement, that this figure continues to be Sappi's target. He said Sappi believed that at least US 20 cents per share would be added to earnings in 2003.
Sappi said today that it will now commence the integration of the new business into Sappi's North American structures. Considerable planning work had been undertaken since the announcement of the transaction, and Sappi expected the transition of the manufacture of products produced at the Brainerd Mill, which Potlatch has announced that it will close, to Sappi's other facilities will proceed smoothly. Trials have been conducted and the ability to manufacture the products at Cloquet and Sappi's other facilities has been confirmed.
The successful conclusion of this transaction ensured Sappi's pre-eminent position in the North American coated fine paper market. A spokesman for Sappi said today that the Cloquet mill would form an important part of Sappi's North American business in the future.
Last week Sappi announced the new management structure for Sappi Fine Paper North America, and also announced that Tom Collins, former Production Manager from Sappi's Somerset Mill, would transfer to Cloquet and become Director of the Cloquet Mill.
Sappi Limited is the largest producer of coated free sheet paper in the world and produces fine papers in South Africa, the United Kingdom, Austria, Belgium, The Netherlands, Germany and in the United States. Sappi's net operating assets of approximately R29 billion are located mainly in Europe (41%), North America (31%) and Southern Africa (28%).
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