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IFC to Invest EUR 43 Million in Stora Enso's Board Mill in Guangxi, China

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Stora Enso, Helsinki, Finland, is strengthening its partnership with International Finance Corp. (IFC) as part of developing its state-of-the-art plantation and board and pulp mill project in Guangxi, China. IFC has agreed to invest an equity stake of RMB 356 million (EUR 43 million) in the project, representing a 5% shareholding. Stora Enso will continue to own 83% of the project, with the remainder owned by Guangxi Forestry Group and Beihai Forestry Investment & Development Co.

In addition, Stora Enso is in the final stage of concluding the long-term external financing for the first phase development of the project. The $460 million funding package will be provided under an IFC syndicate loan structure. It consists of an $88 million loan with 12 years tenor from IFC and a $372 million loan with eight years tenor provided by commercial banks through IFC.

IFC has been supporting Stora Enso in Guangxi with a similar loan structure since 2005, and the long-term funding package is expected to replace the existing financing.

"We welcome the continued support from IFC. This shows the quality of the work we are doing in Guangxi," said Mats Nordlander, EVP, Stora Enso Renewable Packaging.

Stora Enso's investment project is divided into two phases. The first phase is to build a board machine to be ready in the beginning of 2016. The pulp mill will be constructed in the second phase and started up when the board machine is operational. The operations will supply customers with renewable material for products addressing the growing consumer market in China. This includes food, beverage, and confectionary packaging.

Stora Enso employs some 1 100 people in Guangxi, and when the integrated mill is in operation the number of employees will be about 2 000.

 

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