(Sharecast News) - Packing and paper group Mondi said on Monday that it has agreed to buy the 250,000 tonne per annum Hinton Pulp mill in Alberta, Canada, from West Fraser for $5m.
As part of the deal, Mondi will enter into a long-term partnership with West Fraser to access local, high-quality fibre from a well-established wood basket.
Subject to pre-engineering and permitting, Mondi plans to invest €400m in the expansion of Hinton, mainly for a new 200,000 tonne per annum kraft paper machine, expected to be operational from the second half of 2027.
Mondi said the acquisition of the mill, and investment in the paper machine, will fully integrate operations in the Americas and enable it to secure "the long-term supply of high quality, cost competitive kraft paper into its network of 10 paper bags plants in the region", better positioning the company to support the growing market demand for industrial and mailer bags.
Chief executive Andrew King said: "This acquisition will also enable us to further strengthen our position as the global market leader in the production of kraft paper and paper bags.
"We are delighted to be making this investment in Canada and look forward to working with Hinton colleagues, West Fraser as a long-term partner, and other local stakeholders towards improving the mill's environmental footprint and securing its sustainable future."
Mondi (MNDI)