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Borregaard (Norway) and Sappi (South Africa) announce 20,000 tonnes capacity expansion at lignin joint venture
Sappi Limited
(Incorporated in the Republic of South Africa)
Registration number: 1936/008963/06
JSE share code: SAP
ISIN code: ZAE000006284
("Sappi" or the "company")
Media Release
Borregaard (Norway) and Sappi (South Africa) announce 20,000 tonnes capacity
expansion at lignin joint venture in South Africa
Borregaard and Sappi will increase the lignin production capacity by 20,000 tonnes at
LignoTech South Africa. The added volume will be marketed to the joint venture company’s
existing applications and geographical markets. The investment by LignoTech is estimated at
ZAR 105 million (approx. US$ 8.5 million), and the project is expected to be completed in
2017.
Commenting on the decision, Per Arthur Sørlie, President and CEO of Borregaard said “It is
a strategic priority for Borregaard to grow our lignin business. This investment will strengthen
LignoTech South Africa’s competitive position, and improve our offering to key markets in
Asia, The Middle East and Africa.”
Steve Binnie, CEO of Sappi Limited, said “Looking to the future, Sappi will target strong
growth from new business opportunities related to energy, nanocellulose and bioproducts
including lignin and sugars. This expansion is an important vote of confidence in our joint
venture with Borregaard and the global competitiveness of South Africa-based LignoTech.”
LignoTech South Africa is a joint venture for the manufacture of lignin products owned by
Borregaard (50%) and Sappi (50%). The plant was established in 1997 in KwaZulu-Natal and
the capacity has been gradually expanded over time. The new investment will increase the
installed capacity to approximately 180,000 metric tonnes dry substance per year.
Borregaard provides the joint venture with sales and marketing functions in overseas export
markets, in addition to technology, research and development functions. Sappi supplies
lignin raw material and utilities from Sappi’s Saiccor Mill.
The products from LignoTech South Africa are used in a wide range of applications such as
industrial dust control, concrete admixtures, animal feed and agrochemicals.
Borregaard (BRG Oslo) operates the world's most advanced biorefinery. By using natural,
sustainable raw materials, Borregaard produces advanced and environmentally friendly
biochemicals, biomaterials and bioethanol that replaces oil-based products. The Borregaard
Group has 1,080 employees in 16 countries and a turnover in 2014 of approx. NOK 4 billion
(US$500 million) with sales to close to 100 countries worldwide. The lignin business
constitutes close to 50% of the Group’s turnover with manufacturing plants in seven
countries.
Sappi Limited (SAP Johannesburg) is a global company focused on dissolving wood pulp
used in the manufacture of viscose staple fibre, pharmaceutical and household products,
paper-based solutions for printing, packaging and speciality uses as well as business
opportunities in adjacent fields. Headquartered in Johannesburg, South Africa, with over
13,000 employees worldwide and manufacturing operations on three continents in seven
countries, it serves a direct and indirect customer base in 161 countries and has group sales
of US$6 billion.
ENDS
Johannesburg, 07 July 2015
Sponsor:
UBS South Africa (Pty) Ltd
For further information Issued by
André F Oberholzer Brunswick
Group Head Corporate Affairs on behalf of Sappi Limited
Sappi Limited Tel + 27 (0) 11 502 7300
Tel +27 (0)11 407 8044
Mobile +27 (0)83 235 2973
Andre.oberholzer@sappi.com
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