Mondi to buy Hinton Pulp mill in Alberta, Canada, from West Fraser Timber for US$5M, will invest €400M in new 200,000 tonne/year kraft paper machine, with start-up in 2027; deal strengthens Mondi's kraft paper supply for 10 paper bags plants in region

Sample article from our Pulp & Paper Industry

July 10, 2023 (press release) –

Mon, 10. July 2023
Group news, Investment, Flexible packaging, bags and pouches
Paper mill, Kraft Paper
 
 
 

 

 

 

  • Mondi has agreed to acquire Hinton Pulp mill in Alberta, Canada from West Fraser Timber Co. Ltd for USD 5 million.
  • Intention to invest a further €400 million, primarily in a new 200,000 tonne per annum kraft paper machine at the mill.
  • Customers will benefit from a fully integrated and much shorter supply chain, reducing the overall carbon footprint of Mondi’s packaging products in the region.

Mondi plc (Mondi), a global leader in the production of sustainable packaging and paper, has agreed to acquire the 250,000 tonne per annum Hinton Pulp mill in Alberta, Canada, from West Fraser Timber Co. Ltd (West Fraser) for a total consideration of USD 5 million. As part of the transaction, Mondi will enter into a long-term partnership with West Fraser to access local, high-quality fibre from a well-established wood basket.

The intention, subject to pre-engineering and permitting, is to invest €400 million in the expansion of Hinton, primarily for a new 200,000 tonne per annum kraft paper machine, anticipated to be operational from the second half of 2027. The acquisition of the mill, and investment in the paper machine, will fully integrate operations in the Americas and enable Mondi to secure the long-term supply of high quality, cost competitive kraft paper into its network of 10 paper bags plants in the region, better positioning Mondi to support the growing market demand for industrial and mailer bags.

Customers will benefit from a fully integrated and much shorter supply chain reducing the carbon footprint of Mondi’s packaging products in the region. The kraft paper produced at Hinton will have the highest quality and strength parameters, which, in combination with Mondi’s expertise, will meet customer requirements for sustainable packaging solutions as paper is increasingly being used for packaging across the Americas.

Commenting on the acquisition, Andrew King, Mondi Group CEO, said: "Strategically, we are focused on investing to support the growing market demand for our sustainable packaging products, while delivering attractive mid-teen returns through cycle. The acquisition of Hinton is an excellent opportunity for us to secure locally produced kraft paper for our bags customers, helping to meet the current and anticipated future growth in demand for industrial and mailer bags in the Americas. This acquisition will also enable us to further strengthen our position as the global market leader in the production of kraft paper and paper bags.

"We are delighted to be making this investment in Canada and look forward to working with Hinton colleagues, West Fraser as a long-term partner, and other local stakeholders towards improving the mill’s environmental footprint and securing its sustainable future."

The acquisition is subject to customary regulatory clearance and is expected to close towards the end of 2023.

About Mondi

Mondi is a global leader in packaging and paper, contributing to a better world by making innovative solutions that are sustainable by design. Our business is integrated across the value chain – from managing forests and producing pulp, paper and films, to developing and manufacturing sustainable consumer and industrial packaging solutions using paper where possible, plastic when useful. Sustainability is at the centre of our strategy, with our ambitious commitments to 2030 focused on circular driven solutions, created by empowered people, taking action on climate. In 2022, Mondi had revenues of €8.9 billion and underlying EBITDA of €1.8 billion from continuing operations, and employed 22,000 people worldwide. Mondi has a premium listing on the London Stock Exchange (MNDI), where the Group is a FTSE100 constituent, and also has a secondary listing on the JSE Limited (MNP).

Contact:

Judith Wronn, Head of Communication
Flexible Packaging
Tel: +49 151 17714692
Email: judith.wronn@mondigroup.com

 

 

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