Suominen has divested its flexible packaging business, comprising of Suominen Joustopakkaukset Oy and its subsidiaries as well as Suominen Polska Sp. z.o.o, to a UK-based private equity firm Lonsdale Capital Partners LLP and the MBI team, consisting of the management of the business.
The divestment transforms Suominen into a company purely focused on nonwovens, in line with its strategic focus.
The flexibles business area value amounts to €20 million on top of which there is a customary earn-out component amounting to around €1 million. Suominen retains a minority shareholding of 19.9% in the business by converting parts of the currently outstanding intra-group loans into equity, while parts of the above intra-group loans remain as vendor loan. The cash component of the purchase price to be paid at closing to Suominen Corporation amounts to €5.7 million.
Suominen will recognize due to the divestment, in accordance with the IFRS 5 standard, a non-recurring loss of approximately MEUR 4.5 in the second quarter result of 2014 of its discontinued operations.
“Divesting the flexibles business area clarifies both our corporate structure and strategic focus. From now on, Suominen is totally devoted to nonwovens," says Nina Kopola, president and CEO of Suominen.
Suominen will operate two business areas, Convenience and Care, which will be reported in one reporting segment, Nonwovens.