FINANCIAL ANALYSTS: Mercer International – Digesting after Deutschland site tour [RBC]

excerpt from RBC Dominion Securities

We had the pleasure of touring Mercer's Friesau sawmill and nearby Rosenthal pulp mill last week.

First impression

Rosenthal well positioned for the European market - Mercer acquired this sulfite pulp mill in 1994, converting it to a 280K mt Kraft mill in 2000 at a cost of €285MM. Through various de-bottlenecking projects, the current capacity sits at 360K mt. The location is excellent from a fibre standpoint as the mill procures its 75% Spruce/ 25% Pine diet from an 80 km radius (we note that the Czech border is only ~30 km away). Over half of the ...

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