Business Services Industry
M-real Corporation sells its Graphic Papers Business Area
Nordic Business Report, Sept 29, 2008
NORDIC BUSINESS REPORT-29 September 2008-M-real Corporation sells its Graphic Papers Business Area(C)1994-2008 M2 COMMUNICATIONS LTD http://www.m2.com
Finnish forest industry group M-real Corporation (OMX Helsinki:MRLAV) (OMX Helsinki:MRLBV), part of Metsaliitto Group, said on Monday (29 September) that it has signed an agreement to sell its Graphic Papers Business Area to the South African Sappi Limited for an enterprise value of EUR750m.
The transaction consideration consists of EUR500m in cash and assumed debt, EUR200m vendor loan note from Sappi to M-real and EUR50m of newly issued shares in Sappi.
After the closing of the transaction, M-real's net debt will decrease approximately by EUR630m.
The sale comprises the Kirkniemi and Kangas mills in Finland, the Stockstadt mill in Germany and the Biberist mill in Switzerland, with total capacity of 1.9 million tons.
M-real said that it also plans to discontinue the production of standard coated fine paper in the Hallein and Gohrsmuhle mills.
The transaction is expected to reduce M-real's annual sales by approximately EUR1.0bn. The operating result of the units included in the transaction was about EUR30m negative in the first half of 2008.
M-real Corporation, headquartered in Espoo, Finland, is a European paper company with products for consumer packaging, communications and advertising. M-real generated a turnover of EUR5.6bn in 2006 and has 15,500 employees.
One British pound (GBP) is worth approximately 1.25 euros (EUR).
((Comments on this story may be sent to nbr.feedback@nordicbusinessreport.com))
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