GL&V Acquires Alfa Laval Celleco
GL&V (Trois Rivieres, QC), through its new subsidiary GL&V/Celleco Inc., is purchasing the assets of Alfa Laval Celleco (Sweden), a world leader in filtration and cleaning technologies for the pulp and paper industry. The purchase includes all assets of Celleco, consisting of patents, know-how, and intellectual property rights pertaining to its line of technological processes and services.
The purchase price is not yet disclosed, but Celleco's current annual sales are in the $80 million range, primarily in North American and European markets. It operates three main business centers in Stockholm, Atlanta, and Helsinki, and has a direct sales force in Europe, the U.S., Canada, South America, and Southeast Asia, together with a network of agents worldwide.
Laurent Verreault, president and CEO of GL&V explains that the acquisition "allows us to add Celleco's proven technologies, which enjoy excellent brand equity on the international scale, to GL&V's ability to manufacture products at very competitive costs. It also helps consolidate our presence in the U.S., where Celleco records nearly half of its sales.
"In addition," Verreault continues, the acquisition "enables us to acquire a foothold in the European paper industry and to develop business opportunities elsewhere in the world. Currently, the pulp and paper sector is going through a difficult period. As a result, capital expenditures remain at a minimum level. Nevertheless, an important part of Celleco's business consists of spare parts. This will allow GL&V to integrate the Celleco operation during this slowdown in the pulp and paper industry, in order to be ready when the industry resumes its capital spending.
"We believe this represents an exceptional opportunity to move into a new growth phase and take the lead in the consolidation trend in our industry that is accelerating around the world," Verreault points out. He adds that on the financial level, the acquisition will yield benefits primarily as of fiscal 2000, once GL&V has completed the integration and streamlining of Celleco's operational structure.