Norske Skog has agreed to sell the Nature’s Flame pellets company for approximately NZD 47.8 million (€28.1 million).
The Norwegian pulp and paper company has entered into an agreement with Talley’s Group, a New Zealand-based dairy, fishing, produce and food company, to sell Nature’s Flame.
“Nature’s Flame is an excellent company producing high-quality and sustainable energy pellets from wood residues, and thus the sales process generated significant interest,” said Sven Ombudstvedt, CEO of Norske Skog.
“Under our ownership, we have expanded the capacity from producing some 20,000 tonnes when acquired to currently 90,000 tonnes, and we are very pleased that Talley’s has indicated interest to continue the ongoing project to further expand the capacity to 150,000 tonnes. This will support the ongoing decarbonisation of New Zealand industries by transitioning from fossil coal energy to renewable energy like wood pellets.”
Norske Skog acquired the Nature’s Flame business in 2015 for a consideration of NZD 6.7 million (€3.9 million) and has invested a further NZD 7.8 million (€4.5 million) to expand the capacity to 90,000 tonnes.
“Following the closure of the Tasman mill in 2021 and the sale of Nature’s Flame business, the Boyer industrial site at Tasmania is now our only operational asset in the region. The Boyer industrial site will continue to serve the regional publication paper markets and develop its industrial footprint within energy and bio-products.”
The sale further strengthens Norske Skog’s balance sheet and liquidity position in relation to strategic projects in energy and packaging paper. The sale is expected to close during the first quarter of this year.