Dublin-based Zeus Packaging, one of Europe’s largest privately owned packaging companies, is ploughing €15m into Aldar Tissues, a toilet paper maker it bought in 2019 as part of the company’s three-year €40m acquisition spree.
Zeus will spend €10m on building a new 100,000-sq ft manufacturing facility for Aldar in Rathcoole, close to Zeus’s HQ and warehouse depot to keep costs in check. It will also spend €5m on two new fully automated production lines.
The new facility will enable Aldar to quadruple capacity and introduce new premium brands to large retailers across the island of Ireland, the UK, and Europe.
This means Zeus is poised to become the largest Irish manufacturer of own-brand and private label paper products. The packaging company aims to increase its Irish capacity to 40pc of market needs for toilet tissue and paper towels.
Aldar Tissues, which produces Jasmine toilet paper and kitchen towels for supermarkets and industrial paper towels, is one of only two toilet tissue manufacturers left on the island of Ireland.
Ireland imports 80pc of its toilet paper and saw a run on the product in March 2020, when the first Covid-19 lockdown led to consumer fears there would be a shortage of the product.
By acquiring Aldar, Zeus will reduce the Irish market’s reliance on imports from a post-Brexit UK and from Europe, thereby curbing the knock-on impact of high distribution costs on the consumer, according to Brian O’Sullivan, the founder of Zeus.
“The sustainability of that is huge, because the moving of pallets of toilet tissue around the world isn’t very cost effective or sustainable,” he said. “So I’m investing €15m to keep jobs in Ireland and ensure these products are made in Ireland.
“I bought Aldar two years ago when it was in trouble. The owners had done everything in their power to keep it going and they saw that Ireland was going be devoid of its own toilet tissue and industrial paper manufacturing facility because Kimberly-Clark was going to pull out of it in Dublin — and they did pull out.
“The (previous owners) invested nearly €4m over the years but they struggled to get sales and they had some equipment issues. So we bought it and we doubled sales.
"One retailer in Ireland has taken on our Jasmine brand of products and based on that I decided to invest €10m in a new factory and €5m on a new production line. If I didn’t do that, those jobs would be lost, or it would be bought by a UK converter and Aldar’s machine would have been moved to (the UK).
“I was in Slovakia last week and if Aldar had been based there or in many other European countries, the EU would have given us money to help us with our project. And we haven’t received one euro of grant aid from Enterprise Ireland for anything we’ve done because we don’t fit the model. No wonder there’s no manufacturing left here in Ireland — it’s too difficult to compete.”
Since 2019, Zeus has worked with Aldar to improve its financial performance by cutting costs, leveraging economies of scale, and developing new product lines.
Bedding down acquisitions, coupled with new contracts, has helped Zeus shore up revenue during the Covid crisis, especially when its customers in hospitality, offices and other sectors were shut. Turnover climbed 13.5pc to €210m in 2020, and O’Sullivan expects Zeus to post revenue of €275m in 2021.
