Ahlstrom to expand its specialty paper production

Ahlstrom, a global leader in fiber-based materials, has announced that it has signed a Memorandum of Understanding with Brazilian Votorantim Celulose e Papel (VCP) to form a joint venture for specialty paper production in Brazil. The assets in the joint venture, currently owned by VCP, comprise a paper machine, an offline coater and extensive finishing equipment at the Jacarei mill, close to São Paulo. According to the Memorandum of Understanding, Ahlstrom will hold a majority of the joint venture.

Ahlstrom expects to close the deal on or before June 30, 2007, subject to antitrust clearances and satisfactory conclusion of the ongoing due diligence process.

The paper production capacity of the assets is approximately 110,000 tons per year. The joint venture will be part of Ahlstrom's Specialty Papers segment and serve mainly the labeling and flexible packaging markets. In addition, it will continue to produce coated and uncoated paper grades for other end-uses. Currently, most of the paper production is supplied on the local markets but Ahlstrom aims to expand the customer base and serve the markets by utilizing its global specialty materials sales network.