Glatfelter (NYSE: GLT), a global manufacturer of specialty papers and fiber-based engineered materials, today announced it has signed a definitive agreement to purchase Dresden Papier GmbH from Fortress Paper Ltd. (TSE: FTP) for €160 million (approximately U.S.$209 million). Glatfelter expects the acquisition to be immediately accretive to earnings per share by approximately $0.25 on an annualized basis.
Dresden Papier, based in Heidenau (near Dresden), Germany, is the leading global supplier of nonwoven wallpaper base materials, and is a major supplier to most of the world’s largest wallpaper manufacturers. Nonwoven wallpaper offers superior performance and characteristics such as dry strip-ability, higher tear resistance, and no material shrinkage or expansion when wet. As a result, nonwovens are increasingly the product of choice for wallpaper installers and design professionals in Europe, with significant growth potential in Asia.
“Glatfelter’s agreement to acquire Dresden Papier demonstrates our commitment to building leading positions in niche global growth markets for specialty papers and fiber-based engineered materials,” said Dante C. Parrini, Chairman and Chief Executive Officer of Glatfelter. “Dresden Papier has built a preeminent position in nonwoven wallpaper materials – as both the cost and quality leader because of its innovative products, proprietary manufacturing techniques, and long-standing customer relationships.
“The acquisition of Dresden Papier will add another industry-leading nonwovens product line to our Composite Fibers business, and broaden our relationship with leading producers of consumer and industrial products. Despite the ongoing economic challenges in parts of Europe, we believe the global nonwoven wallpaper business will continue to grow at a compound annual growth rate of at least 10%. This acquisition will also provide additional operational leverage and growth opportunities for Glatfelter globally, particularly in large markets such as Russia and China, and other developing markets in eastern Europe and Asia.”In 2012, Dresden’s revenues were €117 million (approximately U.S.$151 million), and Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) were €30 million (approximately U.S.$38 million). Dresden employs approximately 146 people at its state-of-the-art, 60,000-metric-ton-capacity manufacturing facility in Heidenau, Germany.