2012 Nonwovens Sales: $683 million
Key Personnel:Dante C. Parrini, chairman and CEO; John P. Jacunski, senior vice president and CFO; Christopher W. Astley, vice president, corporate strategy; Jonathan A. Bourget, vice president and general manager, advanced airlaid materials; Martin Rapp, vice president and general manager, composite fibers
Plants: Canada, Germany, France, U.K., Philippines
The acquisition of a major manufacturer of wallcovering materials is proof that Glatfelter continues to focus on growth markets. In March, the maker of airlaid and wetlaid nonwovens sealed a deal to acquire Dresden Papier, a leading producer of nonwoven wallpaper base materials and a supplier to most of the world’s largest wallpaper manufacturers. Previously owned by Fortress Paper, a Vancouver, B.C., Canada company, Dresden is based in Heidenau, Germany, near Dresden, where it operates a state-of-the-art, 60,000 metric ton operating facility solely dedicated to the wallcovering market.
At the time of the reported €160 million ($210 million) acquisition CEO Dante Parrini described the acquisition as a continuation of Glatfelter’s focus on adding industry leading nonwoven product lines to its composite fi bers business. The nonwoven based wall covering market is projected to grow 10% per year in coming years, outpacing demand for traditional paper products.
“We see a lot of growth potential for the wallpaper market, particularly in areas like China and South Korea,” says Martin Rapp, vice president and general manager of composite fibers.
Dresden Papier, soon to be rebranded into Glatfelter Dresden GmbH, is now a part of Glatfelter’s composite fibers business, which has been earmarked as a strong growth area for the company as it lessens its reliance on specialty papers.
Since 2006, Composite Fibers, along with the company’s Advanced Airlaid materials business, which was acquired from Concert Industries in 2010, have grown to represent 43% of the group’s sales compared to 30%. Specialty papers meanwhile, which once comprised 70% of sales, now account for 57% of Glatfelter’s business. This shift comes as a result of the company’s strategy of exposing itself to growth businesses, according to Parrini.
In 2012, Glatfelter continued to improve its position on both sides of its nonwovens business—composite fibers containing its wetlaid assets and advanced airlaid. Wetlaid sales grew 4-5% largely in technical and industrial applications such as wipes, furniture and tea bags while airlaid volumes increased 7%, largely driven by advances in feminine hygiene and wipes.
According to Jonathan Bourget, vice president and general manager of advanced airlaid materials, Glatfelter’s airlaid operations, including operations in Canada and Germany, continue to see their supply tighten, leading the company to begin investigating smart ways to increase its global output.
“Strength in airlaid is being driven by downgauging, relying on less material usage in terms of basis weight and the simultaneous increase of square meter volume,” says Bourget.
Also driving growth is the need for market development largely in the personal care segment. “These markets are large enough and rich enough that they are constantly looking at new products,” says Bourget. “I think there is a shift in consumer taste that is promoting new product development in airlaid.”
Glatfelter entered the airlaid business through the acquisition of Concert in 2010 as part of a strategy, begun in the early 2000s, to transform itself from a traditional paper company into a global provider of engineered materials and specialty paper-related products.
While the airlaid business has been in the headlines Glatfelter’s wetlaid operations also continue to grow. The considerable boost from the Dresden acquisition should add about $150 million in sales and $38 million in earnings to the operation.
Apart from wallcoverings the composite fibers business unit is developing rapidly in the electrical segment. Last year the company made a significant investment into a dedicated machine in France. In addition Glatfelter is partnering with DreamWeaver to make a new generation of high performance affordable separators targeted for energy storage devices such as lithium-ion batteries. This partnership will allow DreamWeaver to leverage Glatfelter’s state-of-the art inclined wire capabilities and expertise in making advanced fiber-based engineered materials.
Glatfelter continues to optimize the use of its eight inclined-wire machines to produce a diverse range of products including, nonwoven energy storage materials for the capacitor and lead-acid battery markets. These new fi ber-based materials possess superior porosity and excellent web uniformity in low basis weight and thickness.
“DreamWeaver’s technology is a natural fit, allowing us to extend our presence in the growing energy storage market with innovative and proprietary technology,” says Rapp.