HELSINKI, Finland, April 25 -- Stora Enso today announced that Stora Enso has signed a memorandum of understanding to acquire 100% of the shares in the German paper merchant Schneidersohne Group. The enterprise value of the company is estimated to be EUR 450 million. The all-cash acquisition is expected to be completed during the third quarter of 2005, subject to due diligence and approval by regulatory and competition authorities as well as other required approvals. Synergies have been identified and will be confirmed during the due diligence process and disclosed at the time of signing of the definitive agreement.
The acquisition of Schneidersohne follows the acquisitions of two other paper merchants, Scaldia Papier in the Netherlands and Papeteries de France (PdF). The strategic aim of the acquisitions is to bring Stora Enso closer to the customer and end-user in the value chain and to improve the profitability of its merchant business. Through the Schneidersohne acquisition, Papyrus, Stora Enso's merchant business, will become the second-largest paper merchant in Europe.
Schneidersohne is by sales volume the second-largest paper merchant in Germany and the fifth-largest in Europe. It has operations in 11 countries, the biggest markets being Germany and Switzerland. It has 38 branch offices, including 20 in Germany. Schneidersohne has 2 100 employees and had net sales of EUR 1 130 million from a sales volume of 1 100 000 tonnes of paper and board in 2004.
Schneidersohne will become part of Stora Enso's merchant business. Stora Enso will gain full management control of the company and it will be fully consolidated from the third quarter of 2005 onwards.
The acquisition of Schneidersohne will have the following financial effects on Stora Enso: earnings per share (EPS) and cash earnings per share (CEPS), including synergies, will be enhanced by EUR 0.02 and EUR 0.03 respectively. Stora Enso debt will increase by the enterprise value of Schneidersohne, approximately EUR 450 million and its debt/equity ratio will increase by 0.06 units.
"Schneidersohne is a well-established company with a wide customer base, attractive product range and strong product brands. This acquisition will enable us to better understand the requirements of the whole value chain and to develop our products and services accordingly. We believe this will benefit our other merchant customers as well," says Kai Korhonen, Senior Executive Vice President, Stora Enso Paper.
"Papyrus's strategy is to be a leading player in the European merchant market. This acquisition will enhance our geographical coverage, create a strong position in Germany and Switzerland, and strengthen our existing position in a number of other countries. The combination of Papyrus and Schneidersohne will improve our customer services and generate improved financial returns," says Mats Nordlander, President of Papyrus.
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