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Ahlstrom and Munksjö announce merger

The combination is expected to achieve preliminary combined annual net sales of approximately EUR 2.2 billion.

8th November 2016

Innovation in Textiles
 |  Helsinki

Sustainable, Interiors, Medical/Hygiene

The combination is expected to create significant value for the stakeholders in the combined company through stronger global growth opportunities and improved operational efficiency. The combination will be implemented as a statutory absorption merger whereby Ahlstrom will be merged into Munksjö.

Annual cost synergies are estimated to be approximately EUR 35 million. The cost synergies are expected to be gradually realised over two years following completion of the combination with a more pronounced impact expected from the fourth quarter of 2017. Financial targets for the combined company are expected to include an EBITDA margin above 14% over a business cycle, net gearing below 100%, as well as a stable and annually increasing dividend.

Strong returns

"After the very successful integration of our acquired businesses during the past years and strong operating performance, the combination with Ahlstrom is a natural first step in the execution of our growth strategy, combining two leading businesses into one strong engine for performance and growth," said Peter Seligson, Chairman of the Board of Munksjö.

"The combined company will be positioned for strong long term-financial returns partly through the significant communicated cost synergies but mainly through enhanced future competitiveness and growth opportunities."

Growth mode

"During the past two years, the Ahlstrom management has executed a very focused and successful business turn-around by shedding costs and by focusing on commercial excellence with new products and value adding solutions for our customers. The financial results speak for themselves,” commented Hans Sohlström, Chairman of the Board of Ahlstrom.

“The combination now enables us to directly jump into a growth mode with a much stronger balance sheet and greater earnings potential which will benefit our shareholders and our customers as well as other stakeholders. We will together be able to leverage several strategic advantages and we will focus on shareholder returns through increased profits as well as profitable global growth initiatives in the area of sustainable and innovative fibre-based solutions."

The completion of the combination is subject to, inter alia, approval by the Extraordinary General Meetings of Munksjö and Ahlstrom, which are currently expected to be held on 11 January 2017, as well as merger control approvals from relevant competition authorities. The combination is expected to be completed in the beginning of the second quarter of 2017.

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