Supply shake-up: What will it mean for wipes?

September 15, 2011

I don’t know about you but I am still in shock that Ahlstrom is leaving the wipes market. For years, Ahlstrom seemed intent on gobbling up every small- to mid-sized wipes producer on the planet, a strategy that made it the world’s largest wipes substrate supplier. And, even though the company has been in consolidation mode a little more recently, Ahlstrom has continued to offer up innovation in the wipes market. They certainly didn’t seem like a company with an exit strategy.

However, Ahlstrom executives say the sale to Suominen is in sync with its strategy of developing a more focused business product portfolio, and moving forward the company will offer high performance materials that allow its customers to differentiate themselves. Ahlstrom first embarked on this strategy in 2009 and some could argue the company put this plan in place when it first separated wipes from the rest of its nonwovens business by creating the Home & Personal division in 2008.

It still leaves one to wonder what happened in the last couple of years that changed Ahlstrom’s mind about wipes, a market it was once so bullish about.

Of course, even as it sells off this mammoth business, Ahlstrom has not exited wipes entirely. It will remain vested in wipes, becoming—as part of the sale—the largest shareholder of Suominen, who will become the world’s largest wipes supplier after the deal is complete. Also, Ahlstrom did a big favor to the wipes market, selling this business not to a private equity firm, interested only in squeezing every ounce of profit out of it, but to a company already heavily invested in wipes as both a maker of spunlaced fabrics and as a wipes maker through its Suominen Codi wipes business. No doubt, Suominen has the resources and knowledge, not to mention the passion, to continue the impressive rate of innovation and new product development started by Ahlstrom.
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