Airlaid maker Glatfelter has announced plans to invest approximately $80 million to build a new airlaid facility in the U.S., marking the first significant North American expansion of the technology in more than a decade. The York, PA-based company is currently evaluating location options, primarily in the southern U.S.
“Our Advanced Airlaid Materials business is a global growth platform that has a unique opportunity to capitalize on increasing and unmet demand in North America for the materials used in lighter weight hygiene and disposable wipes products,” says Dante Parrini, Chairman and CEO. “Our plan to build this new facility is in direct response to customer needs for increased capacity in a tightening North American airlaid market.”
The new facility is expected to have an annual capacity of about 22,000 short tons, increasing the company’s total global airlaid materials capacity to approximately 129,000 short tons. According to Glatfelter, the investment is supported by customer commitment to purchase a significant amount of the annual capacity. In addition, the new facility will establish a specialty asset base in the U.S. and create a center of excellence for other lighter basis weight products. Production is expected start in approximately two years and the project will be funded by a combination of cash on hand and its existing credit facility.
“We are planning to locate this facility in close proximity to several key customers and highly efficient transportation routes in the southern U.S., as well as where we have additional access to a high-quality, skilled workforce,” says Chris Astley, senior vice president & business unit president, Advanced Airlaid Materials. “Identifying an optimal location for this facility will provide Glatfelter and its customers with logistics and supply chain benefits, and opportunities for collaboration. Our Advanced Airlaid Materials business enjoys excellent customer relationships, and we expect this new facility will provide us with additional competitive advantage to support long term growth.”
Glatfelter’s Advanced Airlaid Materials Business Unit has leading positions in the feminine hygiene, adult incontinence, wipes and home care markets globally, and its products are also used in food packaging and industrial applications. Glatfelter currently operates airlaid sites in Gatineau, Quebec and Falkenhagen, Germany.
In 2014, Glatfelter's airlaid sales were reported at $281.7 million, a 5% increase led by strong demand in adult hygiene and specialty wipes. The company's last significant expansion was in Germany in 2010, not long after Glatfelter purchased the airlaid operation from Concert Industries.