Asaleo Care has sold its Australian consumer tissue business to Solaris Paper for $180 million.
The business includes Sorbent toilet and facial tissue, Handee Ultra paper towel, and Deeko serviettes and disposable tableware.
The company will retain its consumer tissue business in New Zealand, including Purex toilet tissue, Sorbent toilet and facial tissue and Handee towel.
It will also retain its consumer tissue business in Fiji and Pacific Islands, which distributes the Orchid and Viti brands for toilet, towel and facial tissue, and serviettes.
Asaleo Care chairman Harry Boon said the decision to divest the Australian consumer tissue business flows from the comprehensive strategic review initiated by the company in the first half 2018.
“This transaction represents a win-win, with significant strategic value for both companies, and positions both well for future growth. The sale will enable us to concentrate on our core, higher margin and less capital-intensive businesses in personal care and B2B, and continue to innovate and invest in our brands for long term growth.”
Asaleo Care CEO and managing director, Sid Takla, said: “The objectives of the strategic review were firstly, to drive profitable growth through our brands by being more consumer and customer focused and second, to build a resilient business model that delivers sustainable, long-term growth. We believe this transaction delivers on both objectives. The core personal care and B2B brands and businesses offer higher margins, stronger sales growth and less volatile returns.”
Tikla said proceeds from the sale will significantly strengthen the group’s balance sheet, reduce net debt and improve the company’s leverage ratio.
Solaris Paper is an Australian operated company that produces and distributes high quality toilet and tissue paper brands Livi and Emporia throughout the Australasia region to both retail and away from home markets. Solaris Paper operates a converting facility in Greystanes, NSW.
Solaris Paper, ANZ CEO, Paul Tonkin said: “Solaris Paper’s advanced converting processes and deep vertical integration are an ideal match for the strong market position that Asaleo Care brands have built and maintained in Australia. We expect this deal will create considerable commercial synergies, allowing us to deliver quality products our customers have come to expect, with greater efficiency and reliability.”
Asaleo Care has also secured in principle agreement for a five-year extension to its Trade Mark and Technology Licensing Agreement (TMTLA) with Essity to 2027.
The TMTLA provides technology, marketing and sales rights for the Tork and Tena brands, and a pipeline to research, development and innovation for all of its brands.
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