UPM sells Shotton paper mill in Wales to Turkish Eren Paper

250,000 tons of newsprint to be shut down on 30 September 2021

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UPM Shotton Paper Mill
UPM Shotton Paper Mill

UPM has signed an agreement to sell its Shotton newsprint mill site in North Wales, United Kingdom, and all related assets to Eren Paper Ltd, a subsidiary of Modern Karton Sanayi Ve Ticaret A.Ş., the containerboard and corrugated packaging business of the Turkish industrial conglomerate Eren Holding (“Eren”). The closing of the transaction is planned for late Q3 2021.

Eren’s plan is to integrate the Shotton site into its existing business units and make a further investment. All 190 employees currently working at UPM Shotton will be part of the transaction.

Newsprint production is planned to stop by 30 September 2021, and Eren will take over responsibility for the mill as of 1 October 2021. While Eren will communicate the concrete timeline for the conversion plans, it is already known that the Renewable Energy Generation plant and Material Recovery and Recycling Facility (MRRF) will continue operations throughout the conversion process, corresponding to their role in the regional utility infrastructure.

UPM and Eren collaboration supports the transition with stakeholders

“We are very pleased with this agreement. It will provide a long-term future for the employees at our Shotton paper mill and a continued use of the site infrastructure. It will help UPM to further consolidate its newsprint production capacity while leveraging the value of the site and its assets. This sale will also support Eren in expanding its business in the UK market,” says Winfried Schaur, Executive Vice President of UPM Communication Papers.

“The negotiations with Eren have been transparent and fair throughout, and we have agreed close collaboration over the coming months to support the transition with both internal and external stakeholders.” 

UPM plans to continue serving UK newsprint customers after the sale and will continue sourcing RCP in the UK. In addition, UPM and Eren have agreed to cooperate closely during the transition period to ensure a smooth transfer of the operations.

The transaction will reduce UPM’s annual newsprint capacity by 250,000 tonnes and fixed costs by EUR 30 million upon closing the sale. The fixed costs reduction is in addition to the earlier communicated fixed costs savings impact of EUR 130 million from actions implemented during H2 2020 and 2021.

 

2023 promises an interesting ride for print in India

Indian Printer and Publisher founded in 1979 is the oldest B2B trade publication in the multi-platform and multi-channel IPPGroup. While the print and packaging industries have been resilient in the past 33 months since the pandemic lockdown of 25 March 2020, the commercial printing and newspaper industries have yet to recover their pre-Covid trajectory.

The fragmented commercial printing industry faces substantial challenges as does the newspaper industry. While digital short-run printing and the signage industry seem to be recovering a bit faster, ultimately their growth will also be moderated by the progress of the overall economy. On the other hand book printing exports are doing well but they too face several supply-chain and logistics challenges.

The price of publication papers including newsprint has been high in the past year while availability is diminished by several mills shutting down their publication paper and newsprint machines in the past four years. Indian paper mills are also exporting many types of paper and have raised prices for Indian printers. To some extent, this has helped in the recovery of the digital printing industry with its on-demand short-run and low-wastage paradigm.

Ultimately digital print and other digital channels will help print grow in a country where we are still far behind in our paper and print consumption and where digital is a leapfrog technology that will only increase the demand for print in the foreseeable future. For instance, there is no alternative to a rise in textbook consumption but this segment will only reach normality in the next financial year beginning on 1 April 2023.

Thus while the new normal is a moving target and many commercial printers look to diversification, we believe that our target audiences may shift and change. Like them, we will also have to adapt with agility to keep up with their business and technical information needs.

Our 2023 media kit is ready, and it is the right time to take stock and reconnect with your potential markets and customers. Print is the glue for the growth of liberal education, new industry, and an emerging economy. We seek your participation in what promises to be an interesting ride.

– Naresh Khanna

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