Stora Enso sells its Sachsen mill to Model Group

Stora Enso has signed an agreement to divest its Sachsen Mill located in Eilenburg, Germany, to the Swiss-based family-owned company Model Group. Sachsen Mill has an annual production capacity of 310,000 tonnes of newsprint specialty paper based on recycled paper.

Under the agreement, Model Group will own and operate Sachsen Mill after the transaction is closed. Stora Enso will continue to sell and distribute Sachsen’s paper products under a contract manufacturing agreement for a period of 18 months after the closing. After that period, Model will convert the mill to the production of containerboard. All 230 employees at Sachsen Mill will move to Model Group with the transaction.

“We believe Model will be a good owner to ensure long-term development of the Sachsen Mill. We will continue to serve our customers with high quality paper products from Sachsen Mill at least until the end of 2022,” said Kati ter Horst, EVP, Stora Enso’s Paper division.

The enterprise value of the transaction is Euro 35 million, subject to customary purchase price adjustments. The impact on Stora Enso’s operational EBIT or net debt is not considered material.