Smurfit expands into Argentina
JEFFERSON Smurfit Group is expanding in Latin America with the £17 million cash acquisition of majority stakes in two paper companies.
In the group's first move into Argentina, Smurfit is acquiring 80 per cent stakes in the Celulosa de Coronel Suarez paper mill and the Asindus corrugated cases plant. The companies are located close to each other some 500 kilometres south of the Argentine capital Buenos Aires.
Smurfit's Latin America division already has a strong market position in Colombia, Venezuela, Mexico and Puerto Rico, though, in difficult markets, division profits dropped from £81 million to £47 million for the year to the end of December last.
The group plans to expand the corrugated plant rapidly, according to a spokeswoman. No turn-over or profit figures for the operations were available but the spokeswoman said the operations were profitable.
Smurfit had an option to buy out the remaining 20 per cent of the companies, she said.
Celulosa has a capacity of 35,000 metric tons while the Asindus operation has a capacity of 15,000 tons. The two companies will be consolidated as Smurfit Argentina.
Smurfit has no plans for cost cutting and restructuring at the plants which are considered to operate effectively. The group was bringing marketing and research and development expertise to the operations.
The chairman of Smurfit Latin America, Dr Alan Smurfit, said that Argentina was one of the most important markets in Latin America, adding that the group would be able to contribute to the development of the packaging industry in Argentina.