HELSINKI, Finland, Dec. 31, 2015 (GLOBE NEWSWIRE) -- Stora Enso has signed an agreement to divest its entire 80% shareholding in the Arapoti magazine paper mill in Parana, Brazil, to Papeles Bio Bio, a Chilean paper producer. The consideration for the divestment of the shares is approximately EUR 21 million, subject to customary closing day adjustments. The loss on disposal amounts to approximately EUR 27 million and will be recorded as a non-recurring item in Stora Enso's fourth quarter 2015 results. The transaction will reduce Stora Enso's net debt by approximately EUR 18 million.
The transaction is subject to regulatory approvals and is expected to be completed during the first quarter of 2016. At completion, the cumulative translation adjustment loss will be transferred from an equity reserve to the income statement. Based on the foreign exchange rate on 30 November 2015, the cumulative translation adjustment loss is estimated to be EUR 30 million.
Arapoti's plantation company, which owns 30 000 hectares of plantations, and in which Stora Enso has a 20% shareholding, is not part of the transaction.
Based on 2015 annual figures, the transaction decreases Stora Enso's sales by approximately EUR 100 million.
"Arapoti Mill is in good technical shape and has a loyal customer base. I believe that it will benefit from being part of a Chilean company with a newsprint production unit close to the mill," says Kati ter Horst, EVP Paper division at Stora Enso.
Arapoti Mill is the only producer of coated magazine paper (LWC) in South America. The majority of its production is sold to the domestic market and the rest to other Latin American countries. The mill has an annual production capacity of 185 000 tonnes of LWC, and it employs 320 people. Arauco, a Chilean forest products company, owns 20% of Arapoti Mill.
About the buyer
Papeles Bio Bio S.A. is a Chilean producer of newsprint and mechanical speciality papers, with one mill located in Chile and one in Brazil. Papeles Bio Bio's annual paper production is approximately 300 000 tonnes and the company serves the major newsprint publishers and commercial printers of South America. It is owned by a consortium of Chilean and international investors.
For further information, please contact:
Ulrika Lilja, EVP Communications, tel. +46 72 221 9228
Ulla Paajanen-Sainio, SVP, Investor Relations, tel. +358 40 763 8767
Stora Enso is a leading provider of renewable solutions in packaging, biomaterials, wood and paper on global markets. Our aim is to replace non-renewable materials by innovating and developing new products and services based on wood and other renewable materials. We employ some 27 000 people in more than 35 countries, and our sales in 2014 were EUR 10.2 billion. Stora Enso shares are listed on Nasdaq Helsinki Oy (STEAV, STERV) and Nasdaq Stockholm AB (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY) on the International OTCQX over-the-counter market.www.storaenso.com
STORA ENSO OYJ
Source:Stora Enso Oyj