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CHINA
APP CHINA SUBSIDIARY STARTS UP NEW TISSUE MACHINE
(story contributed by RISI)

APP China's subsidiary, Jiangsu Gold Hongye Paper, has started commercial production on a 10,000 tpy tissue machine at its mill in Suzhou city, Jiangsu province, following trial runs in February.

The company ordered four identical 2.8 m wide tissue machines, each with an operating speed of 550 m/min and a design speed of 600 m/min, from the Chinese manufacturer, Henan Jiaozuo Chongyi Light Industry Machinery. Three of the four units, PMs 3, 4 and 5, came online at the end of last year. The startup of the remaining one, PM 6, has taken the plant's total tissue capacity to 160,000 tpy.

The four machines focus on making lower quality grades with basis weights above 15 g/m•'b2 for products such as napkins, kitchen rolls and toilet tissue, while the two larger Andritz units at the plant make higher quality, lighter weight paper for products such as facial tissue. These two machines, PMs 1 and 2, each boast a capacity of 60,000 tpy, and are among the fastest in the world.

Gold Hongye has also placed an order for another two tissue units, PMs 7 and 8, with a different supplier, Jiangsu Huadong Paper-Making Machinery, which was previously called Kunshan China United No 1 Paper Machinery Factory, or Kunshan Zhonglian No 1 Papermaking Factory. The two 3.5 m wide machines will each have a capacityof 12,000 tpy,with operating speeds of 600 m/min and design speeds of 650 m/min.

Their output will mainly be for hand towels. Startup of PMs 7 and 8 was originally due by September. But the schemes have hit a delay, due to insufficient power supply at the mill to feed the two units. A company spokesman said that Gold Hongye is evaluating whether to install additional generators or purchase electricity from the market. The company is now looking to bring the units online by the end of the year, most likely in October or November.



CHINA
ASCA TO BUY STAKE IN VINDA


SCA is to buy 20 percent of the Chinese tissue company Vinda. With a market share of approximately 4 percent, Vinda is one of the four largest players in China’s tissue market.

SCA’s CEO Jan Å'c5strö'f6m said: “Acquisition of a stake in Vinda provides a good opportunity for SCA to establish an important position in the fast-growing Chinese tissue market. We will then be part owner in a profitable and fast-growing company with modern assets and a strong brand.” The acquisition is in line with SCA’s strategy to grow in China.

The brand Vinda is seen as one of the strongest Tissue brands in China, the second largest tissue market in the world. The company has a strong position in consumer tissue, and has five production plants in China: two in Guangdong and one each in Beijing, Sichuan and Hubei.

The purchase price is set at CNY (yuan renminbi) 366 million corresponding to SEK 330 million. As a result of capacity expansion, Vinda has grown by more than 30 percent in each of the last two years and the strong growth is expected to continue. Economic development in China is creating enormous demand for hygiene solutions in the away from-home (AFH) market segment. SCA is off to a flying start due to the investments in improved hygiene in the service sector being made by China in connection with preparations for the 2008 Summer Olympics in Beijing and the 2010 World Expo in Shanghai. At the end of 2006, SCA announced its establishment in the Chinese market with its global Tork brand.