Ahlstrom Corporation STOCK EXCHANGE RELEASE 28.10.2010 at 9.45
Ahlstrom Corporation, a leading developer and producer of nonwovens and specialty papers, has today signed a joint venture agreement with Longkou Yulong Paper Co. Ltd, a paper producer based in Longkou, in the province of Shandong in northeastern China. The parties have agreed to establish a new manufacturing facility in the Zhuyouguan Industrial Park in Longkou for the production of medical papers used e.g. in sterilization wraps, and masking tape substrates for the building industry in the Asian market.
The parties have agreed that Ahlstrom will have a 60% share in the joint venture and Longkou Yulong Paper will have a 40% share. The total estimated investment amounts to EUR 21.9 million, of which Ahlstrom will invest EUR 13.1 million. The start-up of the new plant is planned for the summer of 2012.
Ahlstrom President & CEO Jan Lång regards the joint venture as an important step in the implementation of Ahlstrom's growth strategy in Asia, and of mutual benefit for both companies.
"We are very pleased to have Yulong Paper as our joint venture partner in China, as the company is very well established in the local paper market and has strong expertise in the paper industry. Through this joint venture, we will be able to serve our local customers in China and Asia in the growing healthcare and building markets", Jan Lång states.
The new site will be part of Ahlstrom's Food & Medical Business Area, which accounted for approximately 20% of the Group's net sales in the third quarter of 2010. The agreement is still subject to the necessary approvals by the authorities and the fulfillment of general closing conditions.
Ahlstrom currently generates about 10 percent of its annual net sales in Asia, and has stated that its strategic target is to grow its Asian footprint markedly from the current level. As part of implementing this growth strategy, Ahlstrom acquired the automotive filter manufacturer Shandong Puri Filter & Paper Products Ltd, based in Binzhou, Shandong, in September.
In addition to the new plant to be established, Ahlstrom has four other manufacturing plants and twelve sales offices in Asia.
Risto Anttonen, Deputy to the CEO, tel. +358 10 888 4166
Jan Lång, President & CEO, tel. +358 10 888 4700
Seppo Parvi, CFO, tel +358 10 888 4768
NASDAQ OMX Helsinki
Ahlstrom in brief
Ahlstrom is a global leader in the development and manufacturing of high performance nonwovens and specialty papers. Ahlstrom's products are used in a large variety of everyday applications, such as filters, wipes, flooring, labels, and tapes. Based upon its unique fiber expertise and innovative approach, the company has a strong market position in several business areas in which it operates. Ahlstrom's 5,800 employees serve customers via sales offices and production facilities in more than 20 countries on six continents. In 2009, Ahlstrom's net sales amounted to EUR 1.6 billion. Ahlstrom's share is quoted on the NASDAQ OMX Helsinki. The company website is at www.ahlstrom.com.
Longkou Yulong Paper in brief
Longkou Yulong Paper Co. Ltd is a comprehensive pulp and paper making company, privatized from Shandong Longkou General Papermaking Plant, a former state-owned company originally started up in 1977. The company produces various grades of premium book and magazine papers. It operates six paper machines with the capacity of 60,000 tons annually, and has a matching poplar pulp-making system and a heat and power plant. The company has 1,200 employees and is located in Longkou City, Shandong Province, 25 kilometers from the Longkou Port and 90 kilometers from Yantai Airport. Longkou has a large commercial port with excellent connections to China and Asia by road and sea. The company website is at www.yulongpaper.com.