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Hansol Paper announces Its merger and investment in thermal papers
Write 한솔제지 Date 2018-07-09

SEOUL, 25 November 2016 (Press Release) - Hansol Paper announces its merger with Hansol Artone Paper. The merger aims to secure the company’s leading position in the thermal paper industry by rebuilding the highly-optimized facilities of Hansol Artone Paper’s Sintanjin mill for producing thermal paper grades as wells as coated woodfree grades. The Board of Directors of the two companies approved the merger at a board meeting held on November 25.

The merger reflects Hansol Group’s strong determination for supporting the continuous growth of its paper manufacturing business, while corresponding to the strategic needs of the two subsidiary companies.

The global demand for printing and writing paper is currently declining by 3.5% annually. By 2020, the demand is expected to further decline by 4.5% annually, thereby generating a widespread consensus for a strategic shift beyond printing paper. In the case of thermal paper, the global market demand is expected to grow 4.2 – 6.6% annually, and more than 7% for label grades in Asia. This rapid growth rate and attractive market conditions of the thermal paper industry further reinforce the need for an anticipatory and strategic entry into the market.

Under these conditions, Hansol Paper has continued to expand its thermal paper sector as part of a greater strategy for expansion into the high-tech specialty paper business, and as a means to cement its position as the leading paper manufacturer in Korea.

In order to increase sales within the rapidly growing thermal label market in Asia, the merger includes a large-scale investment on converting the Sintanjin mill for thermal paper production, projecting an annual production capacity of 320,000 tonnes beginning in 2019. This will place Hansol Paper ahead of OJI Paper Japan and Koehler Germany as the No.1 manufacturer of thermal paper and thereby securing its competitiveness in the global market.

The merger will also allow the two companies to restructure their product line-up by gradually decreasing the portion of printing paper and other low-profit products. The companies also anticipate that the merger will bring positive synergy effects, including improved management efficiency and energy saving.

SangHun Lee, the CEO of Hansol Paper, announced “the merger is a result of strategic decisions made by both companies and their consensus on strengthening Hansol’s presence in the industry by transitioning into specialty paper production.” The CEO further noted that “through bold investment decisions made possible by the merger, the company strives to claim the No.1 position in thermal paper market and achieve $1.8 billion in sales with $140 million in operating profit by 2020.”

Hansol Paper and Hansol Artone Paper plan to finalize the merger by March 1, following a general meeting of shareholders to be held on January 25.

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