Icelandic company buys Latvian wood-processing company Vika Wood

Sep 21, 2006. /Lesprom Network/. The private Icelandic company Norvik hf. has become the owner of the Latvian wood-processing company Vika Wood, LETA reported. The agreement between Norvik hf. and Hebeda Tra AB is subject to clearance from the Latvian competition authority, as representatives from the companies told LETA. They also said that Vika Wood now fully belongs to Norvik hf. The amount of the deal was not disclosed. Since 1995 when Hebeda Tra AB, a joint venture of the Swedish wood-processing companies Bergkvist-Insjon and AB Karl Hedin, started the sawmill company Vika Wood near Talsi, in close cooperation with the log supplier Metsaliitto Latvia Ltd. (at that time Silva Ltd.), the dedicated staff of the company has managed to create the largest sawmill in Latvia now running at 280 000 cubic meters in annual production and some LVL 35 million ($64 million) in sales. Some 15% of sales are delivered to the domestic market and 85% are exported. Japan is a prime market for the sawn goods of Vika Wood. After a strategic review of the possible development of Vika Wood and the need for owners to concentrate on their Swedish operations, the owners have searched for a new business structure of Vika Wood. In this process Catella Corporate Finance with an office also in Riga has been retained as sole advisor. Norvik hf. is privately owned and domiciled on Iceland. Norvik hf. is sole owner of a major wood-processing operation in Latvia with some 600 employees. In Latvia this operation is well known as Byko-Lat Ltd. and CED Ltd. Norvik hf. is having forest operations and smaller sawmills in the Komi Republic in Russia and has also wholesale timber distribution in the United Kingdom through subsidiaries.