Anglo-American purchased a controlling stake in Syktyvar Forest Enterprise, a large paper mill in northern Russia. Anglo-American, headquartered in London, England, is involved in mining and natural resources sectors. It has interests in gold, platinum, diamonds, coal, base and ferrous metals, industrial minerals and forest products.
The $252 million deal, made via Anglo's Mondi Europe subsidiary, will increase the group's shareholding in Syktyvar from 19.4 percent to 87.9 percent. It is subject to the agreement of Russian anti-monopoly authorities.
The move comes amid increasing consolidation in the paper industry and follows $260 million bid by Mondi earlier this year for La Rochette, the French timber and paper group. That offer looks set to be unsuccessful after La Rochette's board recommended a counter-offer from a Spanish company, Saica.
Anglo said its Syktyvar acquisition would include logging and transportation operations as well as construction and engineering businesses. It would form part of Mondi's wholly owned Neusiedler subsidiary, a leading producer of copy and office paper with mills in Austria, Hungary, Slovakia and Israel.
The acquisition will increase Neusiedler's production of uncoated wood-free office communication paper from 1 million metric tons a year to 1.4 million metric tons and will also add 150,000 metric tons of corrugated paper and 150,000 metric tons of newsprint production.