Paper

Resolute acquires Atlas Paper for $156M

Resolute Forest Products Inc., Montreal, has announced its acquisition of Atlas Paper Holdings Inc., a Miami-based maker of tissue products, 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 CEO 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 in economy, value and premium grades. 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.

Resolute says it is positioned to generate synergies and related benefits with this acquisition by:

• optimizing Atlas’ pulp supply using Res- olute’s U.S. market pulp network;
• capitalizing on excess tissue converting capacity;
• immediately integrating Atlas Paper’s tissue expertise for the startup of the Calhoun 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 tons per year of at-home, premium bath tissue and towel focused on the private label market.

Newsprint demand to plummet in China

China’s newsprint demand is expected to decline by 7.6 percent per year from 2015 to 2024, according to the Boston-based forest products research firm RISI.

According to RISI, China’s graphic paper markets have been experiencing a downward shift in demand growth since 2009, and recent changes could further hinder the graphic paper industry.

“China’s younger generations are expected to rely solely on digital media for news in the future as older generations transition gradually,” says Li Meng, an economist with RISI and the lead author of a new study by the firm. “This has already affected graphic paper grades. Newspaper advertising reportedly dropped by 30 percent in the first half of [2015]. Our forecasts show a dismal outlook for demand and growth in graphic paper markets overall, as smartphones and other technology become more prevalent.”

RISI analysts predict that during the next 10 years demand for newsprint in China will decline by 7.6 percent per year and printing and writing paper demand will decrease 0.7 percent per year—a total demand loss of 3.5 million metric tons. These and other findings have been published in “The Chinese Graphic Paper Market: Recent Trends and Future Prospects under Changing Circumstances,” a new study by RISI.

More information on the study, including how to order it, can be found at www.risi.com/chinagraphic.