Application for permission to acquire forestland rejected

Application for permission to acquire forestland rejected The Swedish Board of Agriculture yesterday announced its decision to reject an application from the AssiDomän Group regarding an internal transfer to a wholly owned subsidiary, named Sveaskog, of a total of 883,000 Ha of productive forestland in accordance with the Land Transfer Act (Jordförvärvslagen). The transfer was needed to complete the spin-off of Sveaskog to AssiDomän's shareholders as well as an offer by the Swedish Government to AssiDomän's shareholders to acquire Sveaskog shares against a portion of the Swedish Goverment's holding in AssiDomän. It is AssiDomän's and the Swedish Government's common view that the transaction would be beneficial for AssiDomän and its shareholders including the Swedish Government. AssiDomän and the Swedish Government have had a constructive dialogue and intended to announce an agreement in connection with today's year end report. The implication of the decision by the Swedish Board of Agriculture is that such an announcement currently cannot be made. The purpose of the transaction would be that the Swedish Government should become the sole owner of the forestland in question. If such a transfer were to be structured as a direct sale from AssiDomän to the Swedish Government the permission to acquire would not have been necessary. Furthermore, present legislation enables the Swedish Board of Agriculture to grant permission to acquire if the circumstances are such that an approval could be granted without circumventing the purpose of the law. Regional authorities in Stockholm, Uppsala, Södermanland, Östergötland, Kronoberg, Kalmar, Blekinge, Skåne, Halland, Västra Götaland, Västmanland, Dalarna, Gävleborg, Västernorrland, Jämtland and Västerbotten have all made the judgement that the requirement stated in the Land Transfer Act are applicable in this case. The Board intends to discuss the current situation during today's Board Meeting and provide further information after today's meeting. Stockholm February 9, 1999 AssiDomän AB Corporate Communications ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/1999/02/09/19990209BIT00110/bit0001.pdf http://www.bit.se/bitonline/1999/02/09/19990209BIT00110/bit0002.doc