English

M-real signs Letter of Intent to sell forest assests (30 December, 2004)

Report this content 
M-real Corporation Stock Exchange Bulletin 30.12.2004 at 1.30 p.m.


M-real has signed a Letter of Intent to sell its forestland to a company to be
founded called Forestia Holding Oy. The total transaction value is EUR 172
million of which M-real's share is 95%. The transaction will not have a
material effect on M-real's result. 
 
The owners of Forestia Holding Oy will be Metsäliitto Cooperative with a share
of 49.9%, Suomi Mutual Life Assurance Company with a share of 39.9% and the
Central Union of Agricultural producers and Forest owners with a share of 10.2
%.  The forestland comprising approximately 120,000 ha is currently owned by
Forestia Oy, of which M-real's ownership is 95% and Metsäliitto Cooperative's
5%. 
 
As part of the overall arrangements, M-real will underwrite about EUR 24
million of the subordinated debenture which Forestia Holding Oy will issue in
connection with the transaction. The bonds will yield 8.5% interest and M-real
intends to sell them in the secondary market. 
 
Under the terms of the transaction, Forestia Holding Oy will buy the forest
land of Suomi Mutual Life Assurance Company for a consideration of about EUR 21
million. 
 
The parties plan to complete the transaction before the end of March 2005.
 
The deal is part of M-real's action plan to divest its non-core assets.


M-REAL CORPORATION


Corporate Communications

For additional information, contact Chief Financial Officer Juhani Pöhö, tel.
+358 50 598 7607, kindly before 4.30 p.m. 


M-real Corporation is a European paper and paperboard company with nearly
16,500 employees. M-real provides fibre-based solutions for consumer packaging,
communications and advertising end-uses. Through its worldwide sales network,
M-real serves its customers consisting mostly of publishers, printers, paper
merchants, offices and well-known consumer product companies. The turnover of
M-real in 2003 amounted to 6 billion euros. The company is headquartered in
Finland, and it is listed in the Helsinki Stock Exchange. 

www.m-real.com

Subscribe