Stora Enso has agreed to divest its two sawmills and forest operations in Russia.
The company’s Nebolchi and Impilahti sawmills will be divested to local management. The divestment includes Stora Enso’s Russian forest operations, which supply wood to the sawmills.
Stora Enso’s assessment is that, due to uncertainties in the Russian market, local ownership and operation can provide a more sustainable long-term solution for these business operations and the employees working there.
The sawmill sites are located in Novgorod and Karelia, employing around 330 people, and have a total annual capacity of 350,000 m3 of sawn timber, including 55,000 m3 of processed timber and 65,000 tonnes of pellets.
Stora Enso’s Russian forest operations employ approximately 170 people and manage long-term harvesting rights for around 370,000 hectares.
Pending necessary approvals, the transaction is expected to be concluded in the second quarter of this year and will have no material impact on the firm’s annual sales and Operational EBIT. Due to decreased business prospects in these businesses, an impairment loss of €70 million has been recorded in the first quarter result. The additional loss on the transaction under IFRS will be approximately €60 million, consisting mainly of currency translation adjustments to be recorded at the closing date.