SCA invests for increased competitiveness

  • Regulatory press release

SCA invests for increased competitiveness SCA is carrying out investments to increase competitiveness in the Swedish sawmill operations and German packaging operations. To further optimize coordination between the sawmill operations in SCA and the associated company Scaninge, SCA intends to acquire Scaninge's sawmill operations. The price for the four sawmills (Bollsta, Vilhelmina, Rundvik and Graningebruk) amounts to SEK 270 M, to which will be added separate remuneration for existing working capital. SCA's original ownership interest in Scaninge was 41 percent, which was increased to 59 percent in May 2001. The voting rights in the company have been equally distributed between Graninge and SCA from the start. SCA intends to retain its holding in Scaninge, whose future activities will be solely limited to forestry operations. The operating surplus in the units to be consolidated through the transaction is expected this year to amount to nearly SEK 90 M. The calculated CVA index for the acquisition is 1.3 and, accordingly, exceeds SCA's return requirement by 30 percent. After the acquisition, which requires the approval of the competition authorities, SCA's sawmill capacity will amount to 1.4 million cubic meters. Within the packaging operations, SCA will carry out investments at the corrugated board plant in Minden, Germany. The plant produces 110 million square meters of corrugated packaging annually, making it one of SCA's largest packaging units. To significantly increase productivity in the plant, the facility will be provided a new corrugated board machine, new converting equipment and changes that result in a more efficient product flow through the plant. The investments, which are comparable to the investment measures taken at SCA's plants in Värnamo, Sweden, and Grenå, Denmark, will result in reduced costs and at the same time product quality can be further increased. The investments amount to SEK 161 M and yield a CVA index of 2.0 and, accordingly, exceed SCA's return requirement by 100 percent. Stockholm, 19 December 2002 SVENSKA CELLULOSA AKTIEBOLAGET SCA (publ) Communications and Investor Relations For further information please contact: Jan Åström, President and CEO. Phone +46 70-586 07 01 Peter Nyquist, Senior Vice President Communications and Investor Relations. Phone +46 70-575 29 06 ------------------------------------------------------------ This information was brought to you by Waymaker The following files are available for download: