SCA carries out hygiene products acquisition in Asia
SCA has acquired the Asia-based baby diaper company Drypers for a
purchase price on a debt-free basis of SEK 640 M (USD 87 M). The company
has its registered office and production in Kuala Lumpur, Malaysia, and
had sales in 2003 of SEK 550 M. Drypers is the market leader in baby
diapers in Malaysia (27%) and Singapore (32%) and also has fast-growing
market positions in Thailand and the Philippines. In recent years,
markets in the area have shown growth exceeding 5%. Drypers also holds a
strong position in the incontinence segment.
The company formerly comprised the Asian unit of the Drypers
corporation. The operations were purchased in 1999 by Navis Investment
Partners, a private-equity company, and the management of Drypers Asia.
Through operations being limited to a few product versions and brands,
it was possible to significantly reduce complexity in the manufacturing
and distribution processes and contributed to Drypers having achieved a
costleading position in its markets.
Synergies will arise in the incontinence area as the Group's production
in the region can be concentrated to the Philippines, as well as in the
form of technology support from SCA's other operations in Personal Care.
In addition, SCA's sales organization in the area will be coordinated
with Drypers'. The acquired company could also form a future platform
for an introduction of feminine hygiene products in the area. The
acquisition increases SCA's total sales in Australia and Asia to
slightly less than SEK 2,000 M, of which about two-thirds is related to
Based on an operating surplus in 2003, the EBITDA multiple amounts to
8.3 and the acquisition provides a CVA index of 1.6. The transaction is
assessed to have a marginal positive impact of the Group's earnings per
share in the first 12 months.
Stockholm, 1 March 2004
SVENSKA CELLULOSA AKTIEBOLAGET SCA (publ)
Communications and Investor Relations
For further information, please contact:
Jan Åström, President and CEO.
Phone: +46 70-586 07 01.
Peter Nyquist, Senior Vice President, Communications and Investor Relations.
Phone: +46 70-575 29 06.
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