November 14, 2017 / 3:32 PM / in a year

Brazil's Suzano eyes acquisitions among tissue makers -CEO

NEW YORK, Nov 14 (Reuters) - Brazilian wood pulp and paper maker Suzano Papel e Celulose SA is considering acquisitions among tissue producers, Chief Executive Officer Walter Schalka said, aiming to consolidate a market it recently entered.

The company has invested 540 million reais ($164 million) in two tissue-producing plants in the Brazilian states of Bahia and Maranhao with 120 million tonnes of capacity, and is looking to expand its market share in the segment through dealmaking, Schalka said.

“There are 35 tissue producers in Brazil. Consolidation is needed and it is a good opportunity for Suzano,” Schalka said on Monday evening, without elaborating on the targets.

His comments underscored an appetite for dealmaking even after the biggest target in the pulp and paper market, Eldorado Brasil Celulose SA, was snapped up by Netherlands-based Paper Excellence in September.

The first of Suzano’s new tissue plants started producing recently and the second will begin its ramp-up in the fourth quarter, according to the CEO.

To manage the new products, the new consumer products division headed by Fabio Prado has hired executives with previous experience at rivals such as Kimberly Clark Corp.

Suzano may also open a new pulp-producing plant next year. “We will decide about this investment in the first quarter next year”, Schalka said. Suzano already has a location identified for the potential new unit, which Schalka declined to disclose.

Schalka is in New York this week to meet with investors. The company recently retapped its 2026 and 2047 bonds and is using part of the proceeds to buy back 2021 bonds, extending the maturity of its debts. ($1 = 3.285 reais) (Reporting by Tatiana Bautzer; Editing by Jeffrey Benkoe)

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