Sappi Competes Sale of Enstra Containerboard Mill, to Upgrade Stanger Mill

Sappi, Johannesburg, South Africa, has completed selling its Enstra recycled containerboard and kraft papers mill (photo) and moved production of its Typek paper to KwaZulu-Natal in South Africa. The company had announced this past summer that it would sell the mill’s business to the Corruseal Group, and also unbundle its Cape Kraft recycled packaging paper mill to Golden Era.

The two deals will bring it R600 million in proceeds. 

 

Sappi said it has committed to capital upgrades in 2015 and 2016 to "secure Stanger Mill as a world class office and tissue paper producer." The first phase of this project was completed through a R30 million investment to upgrade various aspects of the paper machine to ensure the paper quality meets the "high standard required in today’s demanding markets."

 

During the next five months, Sappi said it will invest an additional R70 million at the Stanger Mill in its sheeting and finishing operations, with a focus on speed, increasing the throughput of its finished A4 products, as well as improving the packaging quality of its products, it says. 

Sappi plans to close the sale of its Cape Kraft Mill to New Era Holdings before the end of November. The sale of the mills is in line with its strategy to unlock value and strengthen the group’s balance sheet. 

In August, Sappi said third-quarter profit dropped 76 percent to $4 million after planned maintenance shutdowns in all three of its operating regions. 

Sappi Enstra Mill is situated in Gauteng near the town of Springs in South Africa. The mill celebrated its 76th year of existence in 2012, having been established in 1936, producing its first paper in 1938 from PM 1.