Billerud Korsnäs: Swedish Competition Authority approves sale of Bergvik Skog Öst

Billerud Korsnäs has agreed on a long-term wood supply agreement
with the new owner of Bergvik Skog Öst.
05 Jul 2019 − 

Bergvik Skog Öst comprises 350,000 hectares of forestland. Pension fund AMF will acquire 89,9 % of the company's shares for SEK12.2bn.

Billerud Korsnäs has received the green light from Swedish Competition Authority to sell a majority stake in Bergvik Skog Öst to the pension fund AMF. Billerud Korsnäs plans to complete the transaction on 30 August.

The sale price for the 89.9% stake in Bergvik Skog Öst amounts to SEK12.2bn on a net debt basis, according to Billerud Korsnäs. The divestment is said to result in a cash effect of approximately SEK 7.9 billion and improve Billerud Korsnäs's net debt/EBITDA ratio to approximately 1.8.

Bergvik Skog Öst is providing approximately one-tenth of Billerud Korsnäs' total wood supply. The two companies agreed on a 15-year wood supply agreement, whereby Billerud Korsnäs would be the sole buyer of the wood volumes from Bergvik Skog Öst's lands. "At the end of the wood supply agreement Billerud Korsnäs has the right to repurchase Bergvik Skog Öst unless Billerud Korsnäs is offered an extension of the wood supply agreement to the current conditions," Billerud Korsnäs announced.

"The sale releases significant capital, which will enable investments and acquisitions. Billerud Korsnäs is well positioned to capture the increasing demand for sustainable packaging solutions," commented Petra Einarsson, President and CEO of Billerud Korsnäs.

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