English

METSÄLIITTO TO RAISE ITS SHAREHOLDING IN VAPO OY FINNFOREST?S POWER PLANTS AND BIOWATTI?S PELLETS BU

Report this content 
METSÄLIITTO GROUP                  RELEASE               1(1)


                                   26.10.2004 at 10.00 am

Metsäliitto and Finnish government enter into agreement
METSÄLIITTO TO RAISE ITS SHAREHOLDING IN VAPO OY
FINNFOREST’S POWER PLANTS AND BIOWATTI’S PELLETS BUSINESS TO BE SOLD
TO VAPO OY

The government’s cabinet committee on economic policy has authorized
the Ministry of Trade and Industry to sign a preliminary agreement
under which Metsäliitto will raise its stake in Vapo Oy to 49.9% by
purchasing approximately 16.6% of Vapo’s shares. Under the same
agreement, Metsäliitto will sell seven plants generating process and
district heat and power operated by its subsidiary Finnforest
Corporation to a new company in which Vapo Oy will have a controlling
interest and Finnforest Corporation a minority interest. As a result,
Vapo Oy will come under the joint control of the Finnish state and
Metsäliitto Cooperative.

Under the restructuring, Metsäliitto will sell its wood-based fuels
business to Biowatti Oy’s present management. Biowatti Oy’s three wood
pellets plants and briquette plant will be sold to Vapo Oy.

The transactions require the approval of the competition authority and
a decision by the Council of State.

The transactions will bring the Finnish state EUR 46.9 million and
will have a positive impact on the cash flows of both the Metsäliitto
Group and Finnforest Corporation.

Metsäliitto Cooperative acquired 33.34% of the state-owned Vapo Oy in
2002.

Vapo Oy’s core operations are bioenergy and sawmilling. In 2003, it
had sales of EUR 472 million and employed 1,744 people. Parliament has
authorized the Council of State to sell 49.9% of Vapo’s shares.

Biowatti Oy is a Metsäliitto Group subsidiary specializing in
bioenergy. Its business, which is based on wood-based fuels and raw
materials, will be continued by the present management under the name
Biowatti Oy. Under its new owners the company will employ 30 people.
Biowatti’s wood pellets plants, which will be sold to Vapo Oy, are
located at Turenki, Kaskinen and Vöyri, while the briquette plant is
in Pihlava.

The deals will not affect Biowatti’s employees, who will be
transferred either to Vapo Oy or to the new company to be set up by
the management. Metsäliitto will continue to be a major supplier to
Biowatti of wood-based fuels from forestry operations.

For more information contact:
Markku Melkko, Metsäliitto Group Senior Vice President, Energy and
Logistics, tel. +358 1046 94128
Timo Kouri, COO, Finnforest Corporation, gsm +358 50 598 8840
Pekka Laurila, Managing Director, Biowatti Oy, tel. +358 1046 58210 or
+358 50 598 7110

Subscribe