Stora Enso will record a write-down of at maximum USD 575 (EUR 418) million related to its 19.9% NewPage shareholding and vendor note as a non-recurring item in its second quarter 2009 results
Stora Enso will record a write-down of at maximum USD 575 (EUR 418) million
related to its 19.9% NewPage shareholding and vendor note as a non-recurring
item in its second quarter 2009 results
STORA ENSO OYJ STOCK EXCHANGE RELEASE 15 July 2009 at 20.10 GMT
Stora Enso Oyj, NewPage Corporation (“NewPage”) and NewPage's largest
shareholder, Cerberus Capital Management, L.P. (“Cerberus”), announced a plan to
reorganise NewPage's capital structure through a series of concurrent
transactions, including debt tender offers and a potential contribution and
cancellation of a portion of the NewPage vendor note held by Stora Enso and the
debt acquired by Cerberus. As a result of the concurrent transactions and poor
prospects of an upturn in the market, Stora Enso will record a write-down of at
maximum USD 575 (EUR 418 net of hedges) million related to its NewPage
shareholding and vendor note as a non-recurring item in its second quarter 2009
results.
The final write-down amount depends on the result of a tender offer by an
affiliate of Cerberus and NewPage, the amount of the vendor note owned by Stora
Enso that is contributed and cancelled as part of the concurrent transactions
and the fair value of the remaining vendor note. This write-down will have a
maximum impact of only USD 308 (EUR 212 net of hedges after tax) million on
Stora Enso's equity because these unlisted shares and the vendor note have
previously been revalued and the USD 267 (EUR 201) million change in their fair
value has been recorded in equity as part of Other Comprehensive Income.
As part of these concurrent transactions, Stora Enso's NewPage vendor note
issued by NewPage Group with nominal value of USD 200 million (EUR 142 million)
and accrued interest may be partially (50-65%) contributed and cancelled. The
conversion is subject to successful debt recapitalisation by NewPage and an
affiliate of Cerberus, NewPage's indirect controlling shareholder, and their
election to forgive debt in Cerberus' sole discretion. The concurrent
transactions are expected to be finalised by the end of the third quarter of
2009. The concurrent transactions are intended to strengthen New Page's capital
structure and its position as the leading coated paper producer in North America
by increasing its operating flexibility.
The vendor note formed part of the transaction consideration when Stora Enso
finalised the divestment of its North American paper operations to NewPage on 21
December 2007. Following the contribution and cancellation of a portion of the
vendor note, the percentage of NewPage shares owned by Stora Enso will remain
19.9%.
Stora Enso's second quarter results will be announced on 23 July 2009.
For further information, please contact:
Markus Rauramo, CFO, tel. +358 2046 21121
Ulla Paajanen-Sainio, SVP, Investor Relations, tel. +358 40 763 8767
www.storaenso.com
www.storaenso.com/investors
Stora Enso is the world leader in forest industry sustainability. We offer our
customers solutions based on renewable raw materials. Our products provide a
climate-friendly alternative to many non-renewable materials, and have a smaller
carbon footprint. Stora Enso is included in the Global 100 list of the world's
most sustainable companies. Stora Enso is also listed in the Dow Jones
Sustainability Index, the FTSE4Good Index, and the Climate Disclosure Leadership
Index. Stora Enso employs 29 000 people worldwide, and our sales in 2008
amounted to EUR 11.0 billion.
STORA ENSO OYJ
Ulla Paajanen-Sainio Jari Suvanto