Bowater in pounds 15m Dutch acquisition: Packaging group buys release liner plant

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The Independent Online
BOWATER, the packaging and printing group, aims to build on its US leadership in release liners - such as the backing for sticking plaster - with the acquisition of a Dutch specialist, writes Heather Connon.

Bowater is paying 41.5m guilders ( pounds 15.4m) in cash for Van Gelder, a subsidiary of Gelderse Papiergroep, which makes coated siliconised paper for release liners and heat-seal products. Val Gelder's sales are about 40m guilders and it employs 130 people.

The acquisition gives Bowater its first release liner manufacturing plant in Europe, although it is the leading supplier in the US with a market share of about 39 per cent. Michael Hartnall, finance director, said Van Gelder would take over the supply of about dollars 10m of sales which its US business currently exports to Europe.

He described the sale as a small step to determine whether expansion into Europe would be worthwhile. 'We need to ensure we are successful before we move ahead further.' In Europe, the market is dominated by S&E, Lohj-Sterling and 4P, the former Unilever subsidiary.

The purchase is the latest in a series of acquisitions by Bowater aimed at strengthening its core businesses.

Earlier this month, it paid pounds 34.75m, with the possibility of a further pounds 5m of deferred consideration, for a plastics extruder to complement its windows business.

Meanwhile Jefferson Smurfit, the Irish packaging group, is buying a 27.5 per cent stake in Nettingsdorfer Beteiligungs-Aktiengesellschaft, the Austrian owner of a liner mill near Linz which also has interests in corrugated packaging.

Smurfit is paying Ir pounds 20.5m for the shares and it will be able to increase its holding if it wishes.

Dermot Smurfit, joint deputy chairman, said the deal was complementary to its recent acquisition of Cellulose du Pin, the French paper and packaging business, which put it among the top 10 paper and packaging businesses in Europe.

'It brings us into direct contact with Eastern Europe for the first time and we are excited to enter these markets. It is our intention to expand further in the East European countries, through Nettingsdorfer.'

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