Information to Ovako AB (publ) senior secured notes investors

As noted in the Ovako 2015 Annual Report, the tax authority in Finland has sought to limit the deductibility of interest expenses for the years 2010-2013. In light of existing practices for interest deduction in Finland during this period, and after consulting with external tax lawyers, Ovako has previously rejected the tax agency's claim. 

Ovako Finland Oy has now received a tax reassessment notice from the Finnish tax authority. It entails a demand for payment of approximately EUR 9.5 million (including interest and penalties) by the end of January 2017. The demand relates specifically to interest expenses on loans from Ovako Finland Oy's Swedish parent company, Ovako AB (publ), which the tax authority deem non-deductible.

After consultation with external tax lawyers, Ovako disagrees with the reassessment from the Finnish tax authorities and will submit an appeal. Until the appeal is settled Ovako will not be required to pay the demand.

- - -

For more information please contact:
Oskar Bosson, Head of Group Communication, +46 8 622 13 16
Johan Ryrberg, CFO, +46 8 622 1300

Ovako develops high-tech steel solutions for, and in cooperation with, its customers in the bearing, transport and manufacturing industries. Our steel makes our customers’ end products more resilient and extends their useful life, ultimately resulting in smarter, more energy-efficient and more environmentally-friendly products.

Our production is based on recycled scrap and includes steel in the form of bar, tube, ring and pre-components. Ovako is represented in more than 30 countries, and has sales offices in Europe, North America and Asia. Ovako’s sales in 2015 amounted to EUR 834 million, and the company had 2,905 employees at year-end. For more information, please visit us at www.ovako.com