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Sappi to Close Swiss Paper Mill After Failing to Find Buyer
The closure will reduce the company’s production capacity by 500,000 tonnes a year, said the Johannesburg-based company.
“Production at paper machines 8 and 9 has already ceased and production on the uncoated paper line will halt at the end of August,” said Sappi in a regulatory statement today.
The company initially said on March 31 that it was considering closing the Biberist plant as raw materials and energy costs made it unprofitable. It later said it would try to sell the plant, an option that has now failed, according to the statement.
Sappi’s European operations produced 2 million metric tonnes of paper in the six months through March, out of a total 4 million metric tonnes. The closure will affect 550 employees, said Sappi.
“The process to find a suitable purchaser included numerous discussions with interested parties and involved close cooperation between local mill management and Sappi’s European and global management teams to make the purchase as attractive as possible,” said Sappi Fine Paper Europe CEO Berry Wiersum in the statement.
Mondi Ltd. (MND), Stora Enso Oyj and UPM Kymmene Oyj are among papermakers to have closed mills as weaker sales lead to a glut.
Sappi shares fell 1.9 percent to 31.72 rand by 1:25 p.m. in Johannesburg.
To contact the reporter on this story: Sikonathi Mantshantsha in Johannesburg at email@example.com