SAPPI TO BUY POTLATCH'S COATED-PAPER BUSINESS

May 1, 2002 12:00 PM

Sappi Ltd. (Johannesburg, South Africa), a producer of coated fine paper, has reached an agreement to acquire Potlatch Corp.'s (Spokane, WA) coated-fine-paper business and its Cloquet, MN, pulp and paper mill for $480 million. As part of the transaction, Potlatch will close its remaining printing-paper mill in Brainerd, MN, and exit the coated-printing-paper business. In 2001, Potlatch's pulp and coated-paper division reportedly had total annual net sales of $464 million.

Eugene van As, Sappi chairman, notes that a new, $525 million, state-of-the-art pulp mill with a design capacity of 450,000 short tons per year was commissioned in 2000 at the Cloquet site. “We are confident that bringing Sappi's knowledge of pulp manufacturing to this mill, which had initial start-up problems, will result in fine performance,” the exec concludes.

Resource Center