Wood pulp and paper maker Sappi has completed the sale of its Cape Kraft Mill in Cape Town, South Africa to the Golden Era Group.
The move comes on the heels of Enstra Mill's sale earlier this month.
The sale of Cape Kraft Mill and Enstra Mill indicates Sappi's exit from the recycled paper packaging market.
According to the company, the combined proceeds from the sales of Enstra and Cape Kraft Mills amounts to around ZAR600m ($42.7m).
The Cape Kraft Mill converts 67,000 tons of waste paper into 60,000 tons of paper every year.
This facility employs a offline coater, which can coat papers from as light as 46g/m2 to as heavy as 350g/m2. The coater offers corrugators, carton and bag/sack manufacturers a range of barrier and clay-coated papers.
Made out of recycled fiber, Sappi's Cape Fluting and Cape Liner are used in making corrugated boxes and industrial cases respectively.
The company intends to focus on its commercial timber operations; further enhancing its dissolving wood pulp capacity at Ngodwana and Saiccor Mills; investing in its containerboard capacity at its Tugela and Ngodwana Mills; its tissue and office paper capacity at Stanger Mill; its newsprint capacity at Ngodwana Mill.
In addition to providing coated, uncoated and speciality papers made at its European mills, Sappi will increase its by-products offering including Lignosulphonate from Tugela Mill.
Sappi plans to increase energy self-sufficiency at its facilities by installing new turbines at the Tugela and Saiccor Mills next year.
The turbines are expected to produce close to 23MW of power, thereby helping Sappi to increase self-sufficiency from 56% to 72% by the end of 2016.
