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MERGER

Trading halted by paper giant merger rumours

Trading in the shares in Nordic paper giants Holmen, Stora Enso and Norske Skog has been halted on Thursday amid rumours of a partial merger.

Trading halted by paper giant merger rumours

The stock exchanges in Stockholm, Helsinki and Oslo all confirmed on Thursday that they had suspended trading of the three companies pending announcements later in

the day.

Before trading stopped, Norske Skog, one of the world’s biggest newsprint producers, saw its share price soar more than 20 percent on the Oslo bourse, while Stora Enso, Europe’s biggest paper maker, and Holmen had been up more than 4.0 percent.

Finland’s daily of reference Helsingin Sanomat meanwhile reported that the three paper companies were planning to merge at least in part their newspaper print production and move operations under the umbrella of a new, jointly-owned company.

In a statement, Stora Enso denied the paper’s report, saying that “there are no discussions ongoing concerning the matter.”

“It is our policy never to comment on market rumours,” Stora Enso spokesperson Paeivi Kauhanen told AFP.

The other companies also refused to provide details, but said an announcement would be made later, it was confirmed.

In a statement, Norske Skog said it had “on several occasions stated the need for restructuring of the industry, and the company is willing to contribute to such an initiative.”

The Norwegian company insisted however it would not “comment speculations and rumors about strategic processes.”

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REDUNDANCIES

Swedish forestry firm cuts 2,500 jobs

Forestry giant Stora Enso plans to let another 2,500 employees go, of whom 750 work in Sweden, citing weak markets and deflating profits.

Swedish forestry firm cuts 2,500 jobs

The cuts should reduce the company’s outlays by €200 million per year, a saving which includes previously highlighted plans to save on operating costs.

The new move to axe personnel affects 750 jobs in Sweden, where the consortium employs about 5,900 people. The jobs will be cut mostly from administration, and other service professions, rather than in the production line.

About 650 people face losing their jobs in Finland. A further 850 staff members will have to go across Europe, with the remainder to be made redundant in other markets.

Stora Enso underscored that all offices were being hit by savings.

“It will take place from headquarters down to all units. It is very sad news, but it is necessary,” Sweden head Mats Nordlander told the TT news agency.

“We have to find better and smarter ways to work”.

Stora Enso earlier this year announced it would shut down the Swedish factory sites Hylte Bruk and Kvarnsveden, a moved that lobbed off several hundred of jobs in Sweden

CEO Jouko Karvinen said in a statement that the cuts were inevitable.

“We have to react to the weak European economy, structurally shrinking markets in some of our areas, and our low profitability,” Karvinen said.

“We have to face reality and then try to help the employees who are affected by the plans in a responsible way.”

At the same time, it was not all bad news for staff tied to the company. Stora Enso is investing €32 million at the Skoghalls plant, plus planning a renovation of a factory in Finland.

“We have to speed up and hit the brakes at the same time to stay competitive,” Nordlander said.

TT/The Local/

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