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Stora Enso Investing In Germany and Russia

Press release from the issuing company

HELSINKI, Finland, May 22 -- Stora Enso today announced that Stora Enso has approved a EUR 70 million investment in the Baienfurt Mill in Germany to improve productivity and serve growing market demand. The investment will increase the Folding Boxboard (FBB) capacity by 35 000 tonnes to 210 000 tonnes per year. This investment is in line with the Stora Enso cartonboard strategy of streamlining production and establishing a competitive edge by deploying new "shoe calender" technology, which opens up the possibility of increasing capacity while enhancing board quality. A new service centre will improve supply chain efficiency by facilitating swift deliveries of products from Stora Enso's extensive cartonboard range to European customers. Rebuilding will start in September 2002 and is scheduled to be finished in February 2004. Stora Enso has also approved an investment in a new corrugated board mill in Arzamas, a strategic market area with a high growth potential, some 500 km east of Moscow, Russia. The Balabanovo mill has proved very successful and its capacity will be in full use in 2003, so a new mill will be needed to serve growing market demand. The production capacity of the Arzamas mill will be 120 million m(2) and initially the new mill will employ about a hundred people. The capital expenditure will amount to EUR 33 million. Construction is planned to start in October 2002 with production start-up in January 2004. Stora Enso is an integrated forest products company producing magazine papers, newsprint, fine papers, packaging boards and wood products, areas in which the Group is a global market leader. Stora Enso's sales total EUR 13.5 billion and annual paper and board production capacity about 15 million tonnes. Some 43 000 persons are employed in more than 40 countries and the Company's shares are listed in Helsinki, New York and Stockholm.