Sappi sees its takeover of the specialty paper business of Swiss-based Cham Paper Group (CPG) as offering big opportunities for the two companies and their combined customer base.
In late 2017, Sappi, a global producer of dissolving wood pulp, specialty and packaging papers, graphic (printing and writing) paper and biomaterials, entered into an agreement to acquire the specialty paper business of CPG. This included the acquisition of CPG’s Carmignano and Condino Mills in Italy, its digital imaging business located in Cham, Switzerland, and all brands and know-how.
The acquisition is seen as part of Sappi’s diversification strategy and Vision2020 initiative to grow its business in higher margin growth segments and provide customers with a broader product portfolio. It also strengthens Sappi Europe’s specialty and packaging papers footprint and skills, adding 160,000 tons of specialty paper capacity. This capacity increase is in addition to internal capacity conversion projects at Somerset (US), Maastricht and other European mills, a result of more than US$300 million in investments over several projects.
Sappi customers now have access to Cham’s product line, most notably its glassine papers for self-adhesive applications, facestock papers and wet strength papers for label applications, as well as a wide range of coated and uncoated kraft papers suitable for flexible packaging applications, dye sublimation papers and large format inkjet papers.
For customers of Cham, they have been able to access the entire Sappi portfolio of packaging specialty papers, boards and printing and writing papers. They are also benefitting from increased R&D resources, faster delivery times using Sappi’s global logistics footprint, tailored marketing, highly automated systems, and improved sales and customer support. This includes multi-mill sourcing and sales offices in over 50 countries.
Sappi received approvals from regulatory agencies and the shareholders of CPG in late February, and the two companies became one family in March. The two CPG mills and the converting center have now been renamed under the Sappi brand, as of July 1. The Cham brand names have maintained, although these will now be identified as Sappi products.
Michael Bethge, sales director, consumer goods and self-adhesives, at Sappi, commented: ‘The response has been very positive. Sappi has built a great reputation in the packaging industry and in the pressure-sensitive adhesive market, for innovative and sustainable solutions, high quality products and exceptional customer support. The Cham customers we have spoken to are excited about having access to the full portfolio of Sappi specialty paper and board products. They are also delighted that the Cham products and know-how they have been depending on will still be available to them, and there will be no short term change in the papers they have already certified within their supply chains. They view Sappi as a trusted and reliable partner that will help them continue to grow their businesses into the future.’
Sappi Seal and Sappi Guard OHG are new products already announced, while the combined product portfolio includes an extended portfolio for self-adhesive applications, featuring a comprehensive selection of CCK papers, glassine papers and facestock for the pressure-sensitive adhesive industry. Another product area to benefit is barrier papers, with both companies having established expertise in developing barrier paper technology. Dye sublimation is a particular area of interest identified by Sappi. Bethge explained: ‘Cham has a fantastic portfolio of dye sublimation papers under the family brand name of TransJet with great market recognition. That allows Sappi to accelerate growth in this dynamic and growing market. We will be able to leverage the Cham know-how and Sappi’s market presence to make a difference in this market using our competitive advantage and global service capabilities.’
Bethge continued: ‘Unlike acquisitions by financial buyers, where the primary goal is financial gain through organizational consolidation, capacity reduction and leveraging synergies to cut costs, this was a joining of two companies who are dedicated to the markets they serve. Together, they want to grow the business with its customers and create added value. There will be financial benefits, too, but more importantly is what it means for the industry and for our customers. The product lines were very complementary, making it a good fit. And it increases the number of sources available for our customers, since multi-sourcing is important to them. It increases capacity and ensures there are no limitations on further growth for our customers, supported by Sappi’s very strong financial background. It’s truly a win-win situation.’