UPM to Sell 6.7 % of Metsä-Botnia Shares to Botnia
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UPM-Kymmene Corp.,Helsinki, Finland, this week agreed to sell approximately 6.7 % of its shares in Finnish pulp producer Oy Metsä-Botnia Ab (Botnia) to Botnia for EUR 140 million. UPM will record a capital gain of approximately EUR 70 million from the sale of the shares. UPM also agreed to give a call option to the Finnish Metsäliitto Group for the remaining 11% of Botnia still owned by UPM after the redemption and cancellation of the redeemed shares. According to the option agreement, Metsäliitto Group has the right to purchase the remaining shares within the next two years.
The agreements are based on the valuation of UPM's original 17% share of Botnia at EUR 290 million.
UPM notes that the transaction is in line with its strategy to grow as a cost competitive pulp producer and become an active market participant in global pulp markets. UPM's annual pulp production capacity is currently 3.2 million metric tons. The group's current asset base consists of four modern pulp mills, three in Finland, and one in Uruguay. The product range covers northern hardwood and softwood pulp as well as eucalyptus pulp.
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