Paperlinx UK sale immiment

Paperlinx UK sale may be ‘imminent’

14 Apr 2015 |
A deal to salvage something from the wreckage of Paperlinx UK could be imminent, with two bids being considered by administrators, sources close to the situation say.
According to ProPrint sister magazine PrintWeek, one of the potential buyers is Spanish paper manufacturer Lecta, though neither the company nor administrators at Delloite would comment on the report.
The news comes as the April 15 deadline for Paperlinx to sell its Belgium, Netherlands and Luxembourg business rapidly approaches, when financier ING will pull funding.
Chief executive Andy Preece told ProPrint on April 2 that Paperlinx was in formal talks with multiple potential buyers, but there was no binding proposal on the table.
Paperlinx shares remain in a trading halt until Thursday while the company scrambles to give the market any good news to stop a likely run on its stocks, which are already at rock bottom.

Printweek says an unnamed rival paper merchant executive said Lecta had been increasing the volume of its products sold via Paperlinx at the same time as other mills were backing away from the merchant.
Lecta has mills in Italy, France and Spain, owns Garda Cartiere, Torraspapel and Condat, and makes the Regency grade supplied by Paperlinx.
PrintWeek also says Paperlinx operations serving the narrow reel and wide-format markets have also been linked to potential buyers, but the names remain highly speculative.
As far as the Australian operation goes, Preece says the local Spicers business – the country’s biggest paper merchant – is profitable and completely insulated from the dire European situation.
There does not seem to be any panic among Australian printers, though they are watching the situation with interest.
Meanwhile, printers and paper manufacturers out of pocket from the UK collapse are already giving up on ever seeing a penny, with one manufacturer setting aside €3.7m to cover its share of the loss.
Those taking a hit include the East Lancashire Railway in Britain, which paid Paperlinx £18,000, raised through donations and bequests, for glazing on a new station canopy the day before the companies were placed into administration, according to a local newspaper.