Norske Skog divests the former newsprint mill Norske Skog Steti in the Czech Republic to Mondi. The agreed purchase price reflects the book value of the fixed assets in the company.
Newsprint production at Norske Skog Steti ceased at the end of May this year. All operations in the company have ceased and all employment relationships were terminated at the end of June this year.
The decision to stop the newsprint production at the Steti mill is part of Norske Skog’s work to improve its profitability. The fixed costs in the group will be reduced by removing excess capacity and transferring production to other mills with available capacity.
Mondi is currently engaged in production of kraft pulp, kraft paper, containerboard, industrial bags and extrusion coating products at the same industrial site where Norske Skog Steti operated. Mondi will buy most of the production equipment at the former newsprint mill. The agreement includes an option for Norske Skog to move a smaller part of the production equipment to other mills in the group.
Mondi will not resume newsprint production at the former Norske Skog Steti mill and has acquired the site as part of a rationalization of the existing mill site.
The transaction will be carried out by Norske Skogindustrier ASA selling all their shares in Norske Skog Steti a.s. to Mondi Steti a.s. Closing of the transaction is subject to approval from Czech and EU competition authorities, as well as other customary closing conditions for such transactions. The transaction is expected to be completed within 5-7 months.