Editorial

The Great Shake Up

By Karen Bitz McIntyre | February 6, 2008

As we went to press, Fiberweb—one of the world's largest and most diversified nonwovens producers—announced that Avgol, a major supplier of spunmelt nonwovens, was conducting due diligence for a potential purchase. (For more information, see Top of the News, page 12.) Such a sale, if it went through, would instantly create a nonwovens powerhouse, combining Fiberweb's many technologies with Avgol's large spunmelt business and aggressive growth strategies.

This is not the first time that speculation over Fiberweb's sale has occurred. Last year at this time, the industry was rampant with rumors that Polymer Group Inc. was set to buy the company and, of course, Ahlstrom purchased a significant piece of the company in 2007 when it took over its consumer wipes business, a reported €110 million business.

Fiberweb has faced some challenges in recent years. After spending much of the 1990s and early 2000s buying up smaller, specialized nonwovens producers ranging from Veratec in the U.S. to Spanish spunlace maker Tenotex, Fiberweb has most recently been making headlines for divestitures rather than expansion. In addition to the sale of its consumer wipes business, Fiberweb has shut down several older spunmelt lines in North America, virtually exiting the hygiene market here.

However, Fiberweb has continued to grow certain parts of its business, namely airlaid. In the past two years, the company added a second line to its Tianjin, China site as well as one in Italy and had even indicated its goal to become the world's largest airlaid producer in the future.

In addition to airlaid, Fiberweb has a broad manufacturing base as well as a strong global footprint, and at a reported price tag of $238 million (100 pence per share), the company would be a great investment for Avgol, who has done a tremendous job of growing its spunmelt business over the past decade but can be criticized for being too reliant on one technology—spunmelt—and one market—hygiene.

Of course, what a merger of such two large players would mean for the nonwovens and related industries remains to be seen.

Karen Bitz McIntyre
Editor
karenb@rodpub.com

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