[ET Net News Agency, 29 May 2018] Nine Dragons Paper (NDP)(02689) proposed to buy two
pulp and paper mills in Maine and Wisconsin from Catalyst Paper Holdings Inc. for US$175
million.
Morgan Stanley said if the deal is completed, the company will secure high-quality fiber
which can supply China base, and expand to US market.
In addition, it could resolve the tightness in upstream raw materials in the wake of
China's new import policy on wastepaper.
Morgan also thinks the plants will help the company secure waste paper raw materials at
much lower price to address the tight supply and increased expense of raw materials in
China, now that the government has banned imports of unsorted wastepaper and increased
import quality requirements in 2018.
It maintained its "overweight" call on NDP, with an unchanged target price of HK$15.7.
(KL)
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02689 ND PAPER
Nominal 
3.030 +0.140 (+4.844%) Others
29/05/2018 15:39
[I-bank focus]Morgan sees synergies from ND Paper's new buy
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