Pulp giant battles buyout for US$2bil China tissue firm

HONG KONG: Suzano SA, the world’s largest producer of hardwood pulp, and several private equity firms are among the bidders entering the next round for Hong Kong-listed tissue maker Vinda International Holdings Ltd, people with knowledge of the matter say.

Buyout firms Bain Capital, CVC Capital Partners and DCP Capital also moved ahead in the bidding for Essity AB’s majority stake in Vinda, the people said.

Li Chaowang, Vinda’s founder and second-largest shareholder, is also considering teaming up with a bidder for the firm, they said, which has a market value of around US$2.4bil (RM11bil).

Essity has put its stake in Vinda under strategic review, the Swedish personal care product maker said in April. Its stake in Vinda is valued at about HK$9.8bil (US$1.3bil), based on the current stock price.

The owners are weighing about HK$20 (RM11.68) a share as an indicative starting point for negotiations.

Bidders could team up later in the process, though it’s unclear which of them will proceed with final offers, the people said, asking not to be identified as the information is private.

The potential suitors have begun sounding out sources of financing.

Deliberations are ongoing, and the owners could decide against pursuing a deal, the people said. Representatives for Bain, CVC and DCP declined to comment, while representatives for Suzano and Vinda didn’t respond to requests for comment.

It’s still early in the process, said Per Lorentz, vice-president of corporate communications.

A deal for Vinda would allow Sao Paulo-based Suzano to expand in China through a well-established business while expanding its position as a supplier in the world’s second-largest economy. — Bloomberg