Aditya Birla Group Buys Swedish Domsjo Fiber

The Indian Aditya Birla group on Monday announced the acquisition of Sweden-based Domsjo Fiber, a leading Swedish speciality pulp and bio-refinery company for $ 340 million from a Swedish consortium.


The group will acquire it through global companies Thai Rayon Public Company Limited (Thailand) and Indo Bharat Rayon (Indonesia).


On the acquisition, chairman of the Aditya Birla Group Kumar Mangalam Birla said, “This is a world-class company for our pulp & fibre business. Its cutting edge technology and production process coupled with a state-of-the-art biorefinery, add significant value to our pulp & fibre operations. Its high quality pulp will enable us enhance the supply of top quality premium VSF (viscose staple fibre) to our customers. ”


This buy will give the group better control over input supply and pricing, Birla added. The Aditya Birla Group said it would spend $75 mn more on Domsjo expansion.


The group aims to increase its viscose fibre capacity to 1 mn tonne by June 2013 and this buy augments its expansion plans. The buy will also strengthen the captive pulp supply of the group.


K K Maheshwari, business head, pulp & fibre Aditya Birla Group said, “This acquisition is in line with our strategy of having a substantive part of our speciality pulp for our consumption through our captive source. With Domsjö Fiber, we are closer to this goal”.


“Domsjö has an extensive investment programme for capacity expansion from its current 2,10 000 tonne  to 2,55,000 tonne per annum by 2012. We are fully committed to Domsjö’s growth.  Going forward, our intent is to expand the innovation and research and development efforts at Domsjö as part of our global R&D efforts,” added  Maheshwari.


CEO of Domsjö Fiber Ola Hildingsson said, “Aditya Birla Group brings a strong financial base and global presence to our operations and strengthens our position in the entire value chain. With a committment to continue to expand our production facilities and invest further in research and development, Aditya Birla Group is the perfect owner of Domsjö”.


This acquisition will augment the position of group’s pulp and fibre business globally.



 

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