Stora Enso to divest its holding in Bulleh Shah Packaging

Stora Enso, a provider of renewable products in packaging, biomaterials, wooden constructions and paper to global markets, has signed an agreement to divest its 35 percent holding in Bulleh Shah Packaging in Pakistan to the main owner Packages.

Stora Enso to divest its holding in Bulleh Shah Packaging

The transaction is expected to be completed in the third quarter of 2017 and will give Packages full ownership of Bulleh Shah Packaging.

Packages is engaged in the manufacture and sale of packaging materials and tissue products. Its market capitalization is approximately 590 million USD. Stora Enso has a 6.04 percent shareholding in the company.

The cash consideration for the divestment of the shares is six million EUR (seven million USD). The loss on disposal amounts in total to approximately 19 million EUR (22.1 million USD). These will be recorded as items affecting comparability in Stora Enso’s third quarter 2017 results.

Stora Enso CEO Karl-Henrik Sundström said: ‘Stora Enso is focusing its strategy on delivering profitable growth. Due to a changing business environment in Pakistan, the Bulleh Shah Packaging asset with its product mix and related future outlook is a non-strategic fit in our consumer board roadmap. Our focus is on high quality virgin-fiber products. We are committed to make a responsible divestment and intend to leave a positive contribution in the society.’

Stora Enso will carry on with the public private partnership with the International Labour Organization to promote to combat child labor in the Punjab Province of Pakistan until the end of 2018. Furthermore, the group will continue to support its share of the two community investment programs it has been funding in Pakistan. At Stora Enso’s request, an independent third party, KPMG Sustainability Services, is advising the company on responsible exit from Pakistan.