CAH targets China paper potential

By Phil Boeyen, ShareChat Business News Editor

Tuesday 13th March 2001

Carter Holt Harvey (NZSE: CAH) and its majority owner International Paper have together bought a half-share in a private paper company in China.

Under the deal announced today CAH will own 25% of Pacific Millennium Paper Group, a China-based Asian paper distribution and converting business. International Paper has also acquired a 25% stake in the business.

Carter Holt's CEO, Chris Liddell, says Asia, and especially China, are a key to future growth for the company.

"Within these markets, distribution channel management is critical to success.

"This investment gives us immediate access to an established and significant distribution channel with considerable knowledge of the local markets. It also provides the opportunity for us to build and grow the business from a very strong base."

Pacific Millennium is a private company with 1,200 employees located in greater China and South East Asia.

Its main businesses are paper and board distribution and box manufacturing, with the distribution business operating throughout China and Asia. Sales last year were US$350 million.

CAH says the partnership fits perfectly with the company's strategy of growing in the China and Asian markets. It claims China is the second-largest paper market in the world after the US, and the fastest growing.

Mr Liddell says while Carters and International Paper export similar amounts to Asia, the two companies have complementary businesses that will benefit from an integrated marketing approach.

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