Domtar to sell Personal Care business to American Industrial Partners

Domtar will no longer produce baby diapers
after the sale of its personal care division
11 Jan 2021 − 

Domtar is proceeding with the reorganisation of its businesses. After announcing cuts in the fine paper segment and the entry into the containerboard market, the company will part with its personal care division.

Domtar Corporation has taken another important step to reorganise its operations and change the focus of the group. The company announced it had signed an agreement to sell its Personal Care division to private equity firm American Industrial Partners. The transaction price was put at $920m and is expected to close at the end of the first quarter of 2021.

Domtar runs four plants for personal care products, more specifically for absorbent hygiene products such as baby diapers or incontinence products. They are located in Greenville, North Carolina/USA, Delaware, Ohio/USA, Toledo in Spain and Aneby in Sweden. The division was created in 2011 with the purchase of Attends Healthcare.

Domtar had already announced last year that it would undertake a strategic review of the Personal Care business and was considering strategic options, including a possible sale. "With this sale, Domtar is reinforcing its focus on building an industry-leading paper, pulp and packaging company," the group said in a statement. The company is in the midst of a strategic reorientation. While implementing several capacity cuts in the fine paper segment, the company is also planning its entry into the packaging paper market.

Kingsport conversion to containerboard production to be completed by end of 2022

As announced last year, the company wants to convert the 385,000 tpy woodfree uncoated paper machine at its Kingsport mill in Tennessee to the production of lightweight recycled containerboard. The conversion is apparently proceeding well.

Domtar now said it expected to start with the construction work in the second quarter of 2021, with the rebuilt machine ready to start up by the end of 2022. The converted machine will be able to produce up to 545,000 tpy (600,000 sh. t) of testliner and corrugating medium.

This article is an excerpt from our article on Domtar's reorganisation measures.

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