If 2011 was the year of expansion, 2012 is shaping up to be the year of mergers and acquisitions. While this trend officially began in late 2011 with the sale of Ahlstrom’s wipes business to Suominen in October, in 2012 we have seen the sale of all or a part of at least three major nonwovens producers—Fiberweb’s sale of its hygiene-related businesses to Fitesa in January; The Vita Group’s sale of both its U.S. nonwovens business and Libeltex, a good portion of its European concerns; and Avgol’s reported divestment of a large portion of its business to a private equity firm.
Of course, the nonwovens industry is no stranger to ownership changes. In the 1990s, it looked like every nonwovens producer under the sun was going to be bought up by PGI or Fiberweb and Ahlstrom spent the better part of the 2000s buying up spunlace makers and filtration media producers. Of course, since then, all three of these companies have spent a great deal of energy becoming more focused and streamlined companies.
Beyond mergers and acquisitions, there have been periods where private equity investment seemed to be funneling into nonwovens, creating concerns that the nonwovens world was going to be run by a bunch of bankers—concerned only about dollars and cents—rather than scientists or technical gurus who could see the enormous potential nonwovens have in a number of markets.
This round of ownership changes is different, however. Companies seem to be exercising a lot of caution when deciding when and where to invest their funds. Fiberweb and Ahlstrom have decided to focus on specialty areas while Fitesa and Suominen are choosing to grow in high volume, sometimes low margin, markets. Vita Group, for reasons that are unclear, has decided to exit nonwovens altogether, opening up an opportunity for TWE Group, the purchaser of Libeltex, to capitalize on synergies within a number of markets, including hygiene, construction and medical. At the same time, Vita’s exit created a new, management-owned company in North America with plants in North Carolina, Indiana and Texas. Surely, these new or improved companies will breathe new life into the nonwovens industry, opening up new opportunities for fabrics around the world.