The parent company of the Lidl retail chain, Germany’s Schwarz Group, is set to buy a paper mill in Germany from Stora Enso for 210 million euros.

The plant, Maxau mill in Karlsruhe produces 530,000 tonnes of supercalendered paper and 270,000 tonnes of deinked pulp a year.

With the Schwarz Group seeking to reduce its use of plastic, the supercalendered paper – which is typically shiny in form – could be used by the group for packaging food products and in the use of promotional material.

The Scandinavian paper giant, Stora Enso has been divesting itself of paper production sites and should the Maxau deal be approved by regulators, the mill is expected to transfer to Schwarz Produktion, part of the Schwarz Group, in early 2023.

This transaction, explained Stora Enso, is part of its already announced plan to divest four of its five paper production sites. In line with its strategy, Stora Enso’s focus is on long-term growth potential for its renewable products in packaging, building solutions and biomaterials innovations.

“We are very pleased with this agreement, as it fulfils our goal of providing a sustainable long-term future for the Maxau site and its employees. We will continue with the divestment process for the remaining three paper assets; Nymölla, Hylte and Anjala,” said Seppo Parvi, CFO and head of paper division at Stora Enso.

Schwarz’s plan, the company said, is to continue paper production at the site, and the 440 employees belonging to the mill organisation at Maxau will be part of the transaction. Stora Enso will continue to operate the Maxau site and serve its supercalendered paper customers until the close of the transaction.

The transaction will reduce Stora Enso’s annual SC paper capacity by 530,000 tonnes. And it noted that there is a feasibility study ongoing at the Langerbrugge site for the potential conversion of one of the two paper lines there into a containerboard line. Langerbrugge is a significant market destination for newspapers and magazines from the UK.

Schwarz Produktion is the umbrella brand for the production companies of Schwarz Group. Schwarz noted: “In total, more than 4,500 employees in the Schwarz Produktion companies produce high-quality food as well as sustainable packaging and materials for the retail companies Lidl and Kaufland. In addition to mineral water and soft drinks, the Schwarz Produktion companies also produce chocolate, dried fruit, baked goods, coffee and ice cream. In addition, three plastic and recycling plants are a central component of a unique PET materials cycle.”

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