APRIL to acquire Brazilian pulp producer Lwarcel

15 May 2018 − 

Consolidation on the pulp market goes on

The Brazilian pulp market is poised to see more consolidation. As reported earlier, Brazilian eucalyptus pulp producer Lwarcel Celulose has been negotiating with different companies on a potential merger. Several Brazilian newspapers now report that the company is in advanced negotiations with Asia Pacific Resources International Holdings (APRIL). The Singapore-based pulp and paper group has the exclusive rights to purchase Lwarcel for BRL2bn (roughly €465m), writes Jornal do Brasil. APRIL did not wish to comment on the subject.

Lwarcel Celulose produces bleached eucalyptus pulp with a capacity of 250,000 tpy at its site in Lençóis Paulista in Brazil’s São Paulo state. An expansion has long been planned to increase capacity to between 1 and 1.5 million tpy. Lwarcel Celulose is part of Brazil’s Lwart group, whose three subsidiaries are involved in chemical manufacturing (Lwart QuímicaI) and recycling (Lwart Lubrificantes) of oils and lubricants in addition to pulp production. The group employs around 3,000 persons.

APRIL belongs to the Royal Golden Eagle (RGE) group which is also the parent, amongst others, of speciality pulp producers Bracell and Sateri. APRIL operates plantations as well as a gigantic pulp and paper mill in and around Pangkalan Kerinci in Riau province on the Indonesian island of Sumatra. The mill has a capacity to produce 2.8 million tpy of pulp and 850,000 tpy of paper.

The planned acquisition is indicative of ongoing consolidation on the pulp market. Only recently, the merger was announced of the world’s two largest hardwood pulp producers Fibria and Suzano Papel. The merger will give rise to a giant entity with a production capacity of 10.8 million tpy of bleached eucalyptus pulp and 1.3 million tpy of paper and board. The transaction is yet to be finalised pending approval from regulatory authorities.

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