Metsaliitto Group increases holding in Vapo Oy

Nordic Business Report, Oct 26, 2004

NORDIC BUSINESS REPORT-26 October 2004-Metsaliitto Group increases holding in Vapo Oy(C)1994-2004 M2 COMMUNICATIONS LTD http://www.m2.com

Finnish forest industry group Metsaliitto Group said on Tuesday (26 October) that it had signed a preliminary agreement with the Finnish government to increase its holding in the Finnish state-owned bio fuels and energy company Vapo Oy to 49.9% by purchasing some 16.6% of Vapo's shares.

Under the same agreement, Metsaliitto would sell seven plants generating process and district heat and power operated by its subsidiary Finnforest Corporation to a new company in which Vapo will have a controlling interest and Finnforest a minority interest.

As a result of the deal Vapo Oy would come under the joint control of the Finnish state and Metsaliitto Cooperative, the company said.

Under the restructuring, Metsaliitto would also sell its wood-based fuels business to Biowatti Oy's present management, while Biowatti's three wood pellets plants and briquette plant would be sold to Vapo.

The transactions would bring the Finnish state EUR46.9m and would have a positive impact on the cash flows of both the Metsaliitto Group and Finnforest Corporation.

One euro (EUR) is worth approximately 0.68 British pounds (GBP).

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