Svenska Cellulosa Aktiebolaget: a look at SCA

Ashwin Tombat & Shubha Madhukar
31 May 2005

After establishing itself in the European, Australasian, Latin and North American markets, SCA now looks for growth in the Indian market — a profitable proposition, given the rising disposable income and hygiene awareness amongst urban Indians.

To those who are not familiar with it, Svenska Cellulosa Aktiebolaget (SCA) may sound a bit of a tongue-twister. But actually, the company is a European giant, a Swedish paper and forest concern, which is now foraying into the Indian market. Jan Åström is SCA's president and CEO. The company makes hand and face tissues as well as other personal care products, including baby and adult diapers as well as feminine hygiene products like sanitary napkins and panty liners. Annual sales in 2004 amounted to 10 billion Euros ($12.5 billion).

Its packaging division produces corrugated board and containerboard, apart from designing and making consumer and industrial packaging. Its forest group churns out paper (including newsprint), pulp, timber, solid-wood products and forest-based biofuels. SCA owns about five million acres of managed forests in Sweden, but is also Europe's foremost user of recycled paper.

Europe's leading supplier of tissue and personal care products, SCA is the global market leader for incontinence products, and the third-largest supplier of away-from-home (AFH) tissue in North America. SCA is also the market leader in tissue in Australasia and second-largest in Latin America. The company also has operations in Africa and Asia. Expansion areas identified are mainly in Asia, as well as central and eastern Europe. Sales by business area are — approximately — hygiene products 50 per cent, packaging 35 per cent, forest products 14 per cent and others 1 per cent.

Incorporated in 1929 as a holding company for 10 forest industry companies producing sawn goods and paper pulp in northern Sweden, SCA is now headquartered in Gottenberg, Sweden and employs approximately 40,000 people in 40 countries. Swedish investment company Industrivarden controls 30 per cent of SCA.