Financially-troubled paper company Paperlinx has sold its US paper businesses Spicers Paper and Kelly Paper for US$76 million.
Both divisions have been acquired by Central National-Gottesman (CNG), which owns the complementary Lindenmeyr Munroe paper distribution business on the US east coast.
Spicers Paper is a major western US paper distributor with 12 warehouse locations while Kelly Paper operates a chain of paper stores with 48 locations in four western US states. Both companies are based in California and their combined annual sales are around US$500 million.
This latest asset disposal by Paperlinx – which does not include its US$450 million Spicers Canada business – comes as the EU competition authorities have approved the US$56 million sale of its Italian operations, and marks the end of its recent strategic review.
Paperlinx is now banking on a turnaround in its fortunes through diversification into product categories such as packaging and signage and display.
These product areas now account for about 17 per cent of Paperlinx's total sales and 23 per cent of gross profit.