German tissue giant WEPA has announced more cost-cutting measures.
In addition to the planned sale of two mills in Italy, the firm revealed plans to cut some 150 out of a total of 1,500 jobs at its five sites in Germany.
WEPA said it closed a framework agreement with the joint works council and the IG BCE trade union that provides for socially responsible job cuts. The firm mainly plans to resort to attrition, the non-renewal of fixedterm contracts, early retirements and mutually agreed terminations of work contracts. Moreover, WEPA’s employees in Germany agreed to a reduction of their bonus pay check at the end of the year.
According to WEPA, the cost-cutting measures are due to the high costs and price pressure in the sanitary paper sector.
WEPA chief executive Martin Krengel said: “As a producer of commodity products we need to use any opportunity to streamline our business and reduce costs when rising prices for raw materials, energy and logistics cannot be passed on to the customer.
“It is our only chance to maintain our competitiveness and safeguard our long-term future as a family-owned business.”
“We need to use any opportunity to streamline our business and reduce costs.” WEPA chief executive Martin Krengel
Mills for grabs in Italy: WEPA revealed plans to part with two of the five tissue mills of its subsidiary WEPA Lucca in August. The sites in question, WEPA’s Piano della Rocca and Fabbriche di Vallico mills in the Lucca area, produce 17,000tpy and 31,000tpy respectively.
Moreover, the firm plans to move two converting lines from its Salanetti converting facility to other production units outside of Italy. WEPA hopes to finalise the cost-cutting measures by the end of next year.
Pamplona sells WEPA share: As WEPA further revealed, it is no longer partly owned by the UK-based private equity firm Pamplona Capital Partners.
According to the tissue manufacturer, Pamplona sold its 32% share in WEPA to the firm Marsberger Kraftwerksgesellschaft (MKG) in August. The value of the deal was not revealed.
MKG is owned by Martin, Wolfgang and Joachim Krengel, who also own the majority stake in WEPA. Thus the firm is back under full family-ownership.
Pamplona acquired its stake in WEPA in 2010. At the time, the firm revealed plans to invest some Euro 150m over the following 18 months.
Among the planned investment projects were the installation of a new tissue paper machine in Germany and the expansion of WEPA’s hygiene products sites in Spain, France, Italy and Poland.
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