Grigeo AB, Lithuania's major sanitary and household paper and products manufacturer, plans to expand its tissue business and establish a production base in Poland.
The company announced it had already signed a preliminary agreement with Polands' tissue company Głuchołaskie Zakłady Papiernicze (GZP) regarding the acquisition of GZP's tissue and converting facility in Niedomice, near the city of Tarnow in southeastern Poland. The deal was also confirmed by the Santander Bank Polska who advised GZP in the transaction. Grigeo expects the transaction to be completed within 6 months from the signing of the agreement.
The site in Niedomice is one of GZP's three production facilities and is one of the company's two tissue mills. According o GZP-website, the facility has a staff of 175 and runs one tissue machines with a capacity of approximately 20,000 tpy of tissue (1,650 t per month) and five converting lines producing toilet paper, kitchen towels and handkerchiefs. Mother reels produced at Niedomice are also supplied to GZP's converting facility Aska in Nysa.
Grigeo puts the 2022 sales revenue of GZP's Niedomice business at €40m and the EBITDA at €3.8m, based on unaudited data. The estimated enterprise value was €22m, Grigeo announced.
Grigeo said it planned to finance the acquisition from its own financial resources, without revealing financial detail of the deal.
According to Grigeo's CEO Tomas Jozonis, the company's plans for the tissue mill in Niedomice goes beyond stepping into the market in Poland but will allow Grigeo to strengthen its position in the tissue paper markets in Eastern and Central Europe while expanding its product range. "This is a promising and steadily growing market, providing us with broader opportunities for product distribution in Germany, the Czech Republic, Slovakia, Ukraine, and other countries in the region," Jozonis said. The on-site production infrastructure would also allow for optimising in logistics costs.
Lithuania's company reportedly plans to expand the site in the future, increasing production and introducing innovation.
Grigeo AB runs one tissue mill with an installed capacity of approximately 50,000 tpy of recyled and fresh fibre-based tissue. Last year, Grigeo produced 45,000 tpy of tissue.
Grigeo is part of the Grigeo Group. Besides tissue, the group is also producing and marketing recycled corrugated case materials, corrugated board and packaging and fibreboard, and is also activ in the recycling and waste industry.
The group posted a net profit of €10.6m and Ebitda of €21.4m against sales revenue of €203.2m in 2022.