Finland
Further to Stora Enso’s announcement in May 2002 regarding its intention to divest its Finnish forestlands, Stora Enso has sold most of the shares in its Tornator forest asset companies to a new company established by Finnish institutional investors. The aggregate market value of the forest assets is EUR 502 million. Stora Enso owns 41% of the shares in the new company following the sale. The sale resulted in a realised capital gain of EUR 24 million, which will be entered as a non-recurring item in the fourth quarter of 2002.
As part of its forest restructuring programme, Stora Enso transferred its forestland holdings of approximately 600 000 hectares and related operations to Tornator in July 2002, with the intention of selling the majority of the shares by the end of 2002.
Tornator owns and manages the former Stora Enso forestlands, sells cutting rights and offers forest management services. It also sells forestry estates that are located outside logistically favourable areas as well as land for leisure uses. The company has about 50 salaried employees and some 150 forest workers, who were transferred from Stora Enso, maintaining their employment benefits.
Stora Enso Metsä (Forest), Stora Enso’s wood procurement organisation, remains responsible for Stora Enso’s wood procurement and the wood supply for the Group’s Finnish mills. Stora Enso and Tornator have entered into a long-term wood procurement agreement according to which Tornator will supply about 1.5 million cubic metres of timber annually to Stora Enso. In 2002 Stora Enso is expected to procure 25 million cubic metres of wood in Finland, of which 7.5 million cubic metres is expected to be imported.
USA
In September 2002 Stora Enso North America signed an agreement to sell approximately 300 000 acres (125 000 hectares) of its forestland to Plum Creek Timber Company, Inc. This sale was finalised on 3 December 2002. The value of the sale was EUR 142 million (USD 141 million). The capital gain at operating profit level will be about EUR 51 million and will be realised during the fourth quarter of 2002.
Divestment of the Finnish and US forests will strengthen Stora Enso’s balance sheet and reduce the debt/equity ratio by approximately 0.08 (0.53 at 30 September 2002). The capital employed will be reduced by some EUR 500 million and due to this the return on capital employed (ROCE) will increase slightly.
In Sweden various options to release capital tied up in the Group’s forestlands are still being considered.
For further information, please contact:
Esko Mäkeläinen, Senior Executive Vice President and CFO, Finance, Accounting and Legal Affairs, tel. +44 20 8432 1540
Kari Vainio, Executive Vice President, Corporate Communications,
tel. +44 7799 348 197
Keith Russell, Senior Vice President, Investor Relations, tel. +44 20 8432 1552
Voitto Pölkki, Senior Vice President, Forest Finland, tel. +358 40 550 1428
Matti Karjula, Vice President, Forest Finland, Regional Procurement,
tel. +358 40 520 6240
www.storaenso.com
Previous press releases concerning Stora Enso’s forest asset restructuring programme on
www.storaenso.com -> Media Center
September 20, 2002: Stora Enso sells forest assets in the USA
May 16, 2002: Stora Enso to restructure its forest ownership in Finland and the USA
