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BBA To Demerger Fiberweb This Fall

September 5, 2006

BBA Group plans to post the demerger of its Fiberweb nonwovens unit by the end of October and have the deal finalized one month later, the company has reported. This announcement comes amidst significantly decreased earnings for the nonwovens division, which has felt the impact of overcapacity in the wipes segment as well as increased raw material and energy costs. For the six months ended June 30, Fiberweb’s sales remained static at £309 million while earnings decreased from £23 million to £11 million. However, Fiberweb has already initiated reorganizational and productivity projects including the relocation of lines from Toronto to Mexico and Berlin as well as the closure of four older lines in the U.S. These efforts are expected to start benefiting Fiberweb during the second half. Additionally, the division’s industrial business continues to perform well, led by sales in the filtration and dryer sheets categories and continued expansion of the housewrap business, which is expected to benefit from the launch of Coastal Wrap, a product designed to withstand hurricane-strength wind, in early 2007.

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