| Thu 10 Nov 2011, 9:01 | | SAP - Sappi Limited - Sappi Limited announces major investment in North |
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SAP
SAVVI
SAP - Sappi Limited - Sappi Limited announces major investment in North
American operations
Sappi Limited
(Registration number 1936/008963/06)
(Incorporated in the Republic of South Africa)
Share code: SAP
ISIN: ZAE000006284; NYSE code SPP
("Sappi" or the "Company")
Sappi Limited
Sappi Fine Paper
North America
Media Release
Johannesburg and Boston, 10 November 2011
Sappi Limited announces major investment in North American operations - Sappi
Fine Paper North America to convert Cloquet Mill kraft pulp mill to chemical
cellulose and to upgrade coated paper capability at Somerset Mill
Sappi Limited announced today the approval of a US$170 million capital
project to convert the kraft pulp mill in Cloquet, Minnesota to chemical
cellulose used in textile and consumer goods markets. The planned conversion
is slated to come online in 2013 and once complete will allow the production
of 330,000 metric tons of chemical cellulose per year. Approved capital plans
also call for a US$13 million project to upgrade coated paper manufacturing
at the Sappi Somerset Mill in Skowhegan, Maine. These investments reflect
Sappi Limited`s confidence that the North American region can play a
significant role in the global chemical cellulose market, complementing
already strong market positions in release and fine papers.
"The chemical cellulose conversion project at the Cloquet Mill is consistent
with our announced strategy to diversify further into this fast growing
segment," said Ralph Boettger, Chief Executive Officer Sappi Limited. "The
globally low cost position of Sappi`s Cloquet pulp mill will provide an
attractive platform for growth with our current chemical cellulose customers
as well as open up new markets to us."
Sappi is currently the world`s largest manufacturer of chemical cellulose out
of its Saiccor Mill in KwaZulu-Natal, South Africa. The Cloquet project,
together with the earlier announced expansion at the Sappi Ngodwana Mill in
South Africa will bring Sappi`s total chemical cellulose capacity to over 1.3
million metric tons per year.
"We are excited about the new growth opportunities this investment in
chemical cellulose brings to Sappi Fine Paper North America, all of our
employees and the Cloquet community," said Mark Gardner, President and Chief
Executive Officer Sappi Fine Paper North America. "Our planned conversion
will allow the continued production of kraft pulp for maximum flexibility to
react to changes in global pulp markets. This project, together with the
coated paper investment at Somerset Mill, ensures that we can grow profitably
in both cellulose and fine paper markets for years to come."
The Cloquet conversion project will not affect the company`s coated paper
business at that site. Dry fiber handling systems and improvements to paper
machine capabilities approved as part of this project ensure that product
quality across all grades will be unaffected.
Currently, the Cloquet pulp mill produces hardwood kraft (NBHK) pulp for
market sales. Sappi will work closely with its pulp customers to ensure an
orderly transition, including, where appropriate, making supplies available
from its Somerset Mill in Skowhegan, Maine.
The US$13 million capital project at the Somerset Mill includes upgrades to
the existing gap former on PM3, improving its cost structure and allowing the
production of a broader range of products on the machine. The PM3 rebuild
project is slated for completion in fall 2012.
ENDS
About Sappi Fine Paper North America
Sappi Fine Paper North America, known for innovation and quality, is a
preeminent North American producer of coated fine and release papers
headquartered in Boston, Massachusetts. Its coated fine papers, with highly
recognized brand names such as McCoy, Opus, Somerset, and Flo, are used in
premium magazines, catalogs, books, and high-end print advertising. The
company is also the world`s leading supplier of Release or `specialty papers`
for the automotive, fashion and engineered films industries, including the
globally recognized Ultracast brand. Sappi`s Release papers provide the
surface aesthetics for synthetic fabrics used in footwear, clothing,
upholstery and accessories, as well as the textures for decorative laminates
found in kitchens, baths, flooring and other decorative surfaces. Sappi Fine
Paper North America is a division of Sappi Limited, a global company
headquartered in Johannesburg, South Africa, with manufacturing operations on
four continents in eight countries, sales offices in 35 countries, and
customers in over 100 countries around the world.
Issued by:
Brunswick South Africa on behalf of Sappi Limited
Tel + 27 (0) 11 502 7300
For further information:
Amy Olson
Corporate Communications Manager
Sappi Fine Paper North America
Tel: 617.423.5409
Mobile: 617.320.1646
Amy.Olson@sappi.com
Andre F Oberholzer
Group Head Corporate Affairs
Sappi Limited
Tel: +27 (0) 11 407 8044
Mobile: +27 (0) 83 235 2973
Andre.Oberholzer@sappi.com
Date: 10/11/2011 09:01:00 Produced by the JSE SENS Department.
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