Tissue giant SCA is to make a public cash offer for the Chinese tissue company Vinda.
The offer is conditional on SCA achieving an ownership share in Vinda in excess of 50%.
SCA is currently the second largest shareholder in Vinda; it became a part owner in the tissue manufacturer in 2007 and currently has a 21.7% holding in the company with two representatives on its board of directors.
The offer will be Hong Kong Dollar (HKD) 11.00 per share, corresponding to a premium of approximately 34.5%, based on the average closing price over the past 30 trading days.
Jan Johansson, president and chief executive of SCA, said: “Vinda is a strong player in the Chinese tissue market and has demonstrated healthy growth and profitability.
“As a majority shareholder, we would see the potential to further strengthen the company to ensure its future competitiveness.”
Vinda is the third largest tissue company in China.
In 2012, Vinda’s sales rose 26% and amounted to approximately SEK 5bn. The company’s operating margin was 12.9%.
The complete prospectus for the offer is expected to be presented no later than 30 September.
The transaction is expected to be finalised in the fourth quarter of this year.