Resolute Forest Products Inc., Montreal, has announced its acquisition of Atlas Paper Holdings Inc., a manufacturer of tissue products based in Miami, for $156 million.
“This is a step-change acquisition that provides us with an immediate position in the multibillion-dollar North American consumer tissue market,” says Richard Garneau, president and chief executive officer of Resolute Forest Products. “We’re following through on our strategy toward the Resolute of the future with an acquisition that capitalizes on our unique ability to capture synergies by integrating forward our U.S. market pulp assets. This acquisition also gives us immediate tissue industry experience as we work toward bringing our Calhoun (Tennessee) tissue project online by early 2017.”
Atlas Paper manufactures branded and private label tissue products for the at-home and away-from-home markets. It offers virgin and recycled products, covering economy, value and premium grades, according to the company. Atlas Paper operates three tissue machines, with an annual production capacity of approximately 65,000 short tons; 14 converting lines in Hialeah (Miami) and Sanford (Orlando, Florida); and a paper recycling facility in Tampa, Florida. The paper manufacturer employs about 360 people.
“This is a step-change acquisition that provides us with an immediate position in the multibillion-dollar North American consumer tissue market,” says Richard Garneau, president and chief executive officer of Resolute Forest Products. “We’re following through on our strategy toward the Resolute of the future with an acquisition that capitalizes on our unique ability to capture synergies by integrating forward our U.S. market pulp assets. This acquisition also gives us immediate tissue industry experience as we work toward bringing our Calhoun (Tennessee) tissue project online by early 2017.”
Atlas Paper manufactures branded and private label tissue products for the at-home and away-from-home markets. It offers virgin and recycled products, covering economy, value and premium grades, according to the company. Atlas Paper operates three tissue machines, with an annual production capacity of approximately 65,000 short tons; 14 converting lines in Hialeah (Miami) and Sanford (Orlando, Florida); and a paper recycling facility in Tampa, Florida. The paper manufacturer employs about 360 people.
It will be “business as usual” at Atlas Paper in terms of relationships and commitments to suppliers and customers, Resolute says.
Resolute says it is uniquely positioned to generate synergies and related benefits with this acquisition, by:
Resolute says it is uniquely positioned to generate synergies and related benefits with this acquisition, by:
- optimizing Atlas Paper’s pulp supply using Resolute’s strong U.S. market pulp network;
- capitalizing on excess tissue converting capacity;
- immediately integrating Atlas Paper’s tissue expertise for the start-up of the Calhoun tissue project in Tennessee; and
- offering a greater range of products—economy, value and premium grades—to existing and future customers.
Garneau says Resolute plans to build state-of-the-art tissue and converting facilities” in Calhoun that will produce approximately 66,000 short tons (60,000 metric tons) per year of at-home, premium bath tissue and towel focused on the private label market.
“By integrating our U.S. pulp assets to produce high-quality products, we will compete in that market as one of only a few integrated producers, using the latest technology,” Garneau says.
He continues, “With today’s announcement, we enter the tissue market right away, and we do so by way of an acquisition that is synergistic and also integrative. We will benefit from the know-how and the expertise of Atlas Paper’s experienced tissue manufacturing, sales and management teams, and we will have access to its customer base.”
Jim Brown, president and chief executive officer of Atlas Paper Holdings Inc., says, “We are excited about becoming part of a larger, diversified company that views the tissue market as a cornerstone of its future.”
“By integrating our U.S. pulp assets to produce high-quality products, we will compete in that market as one of only a few integrated producers, using the latest technology,” Garneau says.
He continues, “With today’s announcement, we enter the tissue market right away, and we do so by way of an acquisition that is synergistic and also integrative. We will benefit from the know-how and the expertise of Atlas Paper’s experienced tissue manufacturing, sales and management teams, and we will have access to its customer base.”
Jim Brown, president and chief executive officer of Atlas Paper Holdings Inc., says, “We are excited about becoming part of a larger, diversified company that views the tissue market as a cornerstone of its future.”
He explains “This is a win-win for Atlas Paper, we will benefit from pulp supply efficiencies and we will offer a wider range of products to our customers once the Calhoun tissue project is up and running; for Resolute, my team can bring the market knowledge and expertise that will help us all meet our common business objectives.”
The $156 million purchase price in the transaction, which closed Nov. 16, 2015, included working capital, Resolute says. The company estimates approximately $23 million of annualized earnings before earnings before interest, taxes, deductions and amortization (EBITDA), including synergies, starting in the first quarter of 2016. Resolute says it expects to maintain Atlas Paper’s current structure and most employees, including management, will remain with the organization The financial results attributable to these assets will be reported in a stand-alone “tissue” segment. The company paid for Atlas Paper with available cash but says it plans to explore financing opportunities in the coming months, considering its previously reported significant capital expenditure expectations in connection with the Calhoun tissue project, Resolute states.
BMO Capital Markets acted as the financial advisor and Akerman LLP acted as the legal advisor to Resolute on the transaction.
Resolute Forest Products says it is a global leader in the forest products industry with a diverse range of products, including newsprint, specialty papers, market pulp and wood products. The company owns or operates some 40 pulp and paper mills and wood products facilities in the United States, Canada and South Korea, as well as power generation assets in Canada. Resolute markets its products in nearly 80 countries.
The $156 million purchase price in the transaction, which closed Nov. 16, 2015, included working capital, Resolute says. The company estimates approximately $23 million of annualized earnings before earnings before interest, taxes, deductions and amortization (EBITDA), including synergies, starting in the first quarter of 2016. Resolute says it expects to maintain Atlas Paper’s current structure and most employees, including management, will remain with the organization The financial results attributable to these assets will be reported in a stand-alone “tissue” segment. The company paid for Atlas Paper with available cash but says it plans to explore financing opportunities in the coming months, considering its previously reported significant capital expenditure expectations in connection with the Calhoun tissue project, Resolute states.
BMO Capital Markets acted as the financial advisor and Akerman LLP acted as the legal advisor to Resolute on the transaction.
Resolute Forest Products says it is a global leader in the forest products industry with a diverse range of products, including newsprint, specialty papers, market pulp and wood products. The company owns or operates some 40 pulp and paper mills and wood products facilities in the United States, Canada and South Korea, as well as power generation assets in Canada. Resolute markets its products in nearly 80 countries.
Latest from Recycling Today
- Greenwave Technology pares back losses in Q3
- Lindner shredders prepare Brazilian plastic for recycling
- China ups steel output, while other nations cut back
- ReElement, Posco partner to develop rare earth, magnet supply chain
- Comau to take part in EU’s Reinforce project
- Sustainable packaging: How do we get there?
- ReMA accepts Lifetime Achievement nominations
- ExxonMobil will add to chemical recycling capacity
