Glatfelter to Acquire Georgia-Pacific's U.S. Nonwovens Business for $175 Million
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Glatfelter Corporation announced the signing of a definitive agreement to purchase Georgia-Pacific's U.S. nonwovens business for $175 million, subject to customary post-closing purchase price adjustments.
Glatfelter will acquire Georgia-Pacific's Mount Holly, North Carolina, airlaid manufacturing business and an R&D pilot line for nonwovens product development in Memphis, Tennessee, which collectively employ approximately 150 people. The Mount Holly facility has a capacity of 37,000 metric tons and produces high-quality airlaid products focused on wipes and tabletop materials. The R&D pilot line and additional technical resources will enhance ongoing innovation efforts.
"The agreement to acquire Georgia-Pacific's U.S. nonwovens business further reinforces our commitment to invest in growth opportunities as part of Glatfelter's ongoing transformation while also expanding our operating footprint in the United States," said Dante C. Parrini, Chairman and Chief Executive Officer of Glatfelter. "Our airlaid business has delivered strong results throughout an unprecedented 2020. The Mount Holly facility, along with the R&D pilot line, will allow us to continue to build on this success and better serve our customers."
Mike Adams, President of Georgia-Pacific Professional and Nonwovens, said, "Georgia-Pacific nonwovens employees at Mt. Holly and Memphis have run safe, productive operations and worked hard to advance our nonwovens business to meet customer needs. We believe this sale to Glatfelter, an established manufacturer and supplier of nonwovens products, is in the best interests of both customers and our nonwovens employees."
Georgia-Pacific's U.S. nonwovens business generates annual net sales and adjusted EBITDA of approximately $100 million and $20 million, respectively. Glatfelter expects to realize annual cost synergies of approximately $4 million to $6 million within three years and incur one-time costs of approximately $10 million for transaction fees and integration.
Glatfelter plans to finance the acquisition through a combination of cash on hand and borrowing under its existing revolving credit facility.
The transaction is subject to customary closing conditions, including receipt of required regulatory clearances.
