The consideration for the divestment of the shares is approximately Euro 21 million, subject to customary closing day adjustments. The loss on disposal amounts to approximately Euro 27 million and will be recorded as a non-recurring item in Stora Enso’s fourth quarter 2015 results. The transaction will reduce Stora Enso’s net debt by approximately Euro 18 million.
The transaction is subject to regulatory approvals and is expected to be completed during the 1Q 2016. At completion, the cumulative translation adjustment loss will be transferred from an equity reserve to the income statement. Based on the foreign exchange rate on 30 November 2015, the cumulative translation adjustment loss is estimated to be Euro 30 million.
Arapoti’s plantation company, which owns 30,000 hectares of plantations, and in which Stora Enso has a 20% shareholding, is not part of the transaction.
Based on 2015 annual figures, the transaction decreases Stora Enso’s sales by approximately Euro 100 million.
“Arapoti Mill is in good technical shape and has a loyal customer base. I believe that it will benefit from being part of a Chilean company with a newsprint production unit close to the mill,” says Kati ter Horst, EVP Paper division at Stora Enso.
Arapoti Mill is the only producer of coated magazine paper (LWC) in South America. The majority of its production is sold to the domestic market and the rest to other Latin American countries. The mill has an annual production capacity of 185,000 tonnes of LWC, and it employs 320 people. Arauco, a Chilean forest products company, owns 20% of Arapoti Mill.
