SCA is to take over the European tissue business of Georgia-Pacific. However, the company will have to pass on some business in the UK, Benelux and Scandinavia.
The European Commission (EC) has given green light to SCA’s takeover of Georgia-Pacific’s European tissue business on 5 July. Accordingly, SCA is to acquire 15 production plants in seven countries employing 4,700 people.
However, SCA will have to sell some business in order to comply with competition rules. The Commission’s clearance requires divestment of Georgia-Pacific’s consumer tissue business in the UK including production capacity, Georgia-Pacific’s Benelux consumer tissue branded business under the Lotus brand and some of Georgia-Pacific’s and SCA’s retailer branded business in Scandinavia including production capacity.
SCA had announced its intention to take over the European operation of Georgia-Pacific back in November 2011 and had offered €1.32bn. Besides an improved range of products, the company also believes it would benefit from an optimised geographic structure and anticipates annual savings of €125m after the possible conclusion of the transaction.
Georgia-Pacific accepted SCA’s offer in February 2012. The transaction is to be finalized on 20 July.
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