Tuesday, October 29, 2024
Stora Enso, a global provider of renewable solutions in packaging, biomaterials, wooden constructions, and paper, has entered into an agreement to acquire 100% of Junnikkala Oy, a Finnish sawmill company. This acquisition will bolster Stora Enso’s wood supply chain for its Oulu packaging board site in Finland, enhancing operational efficiency and expanding its wood products business with significant new production assets.
The enterprise value for the transaction is set at up to EUR 137 million, contingent on meeting specific production milestones. Pending customary regulatory approvals, the acquisition is expected to close in the first half of 2025.
Junnikkala Oy, which specializes in sawn timber and processed wood products for both domestic and international markets, operates three sawmills in Finland, including a recently completed state-of-the-art facility located less than 10 kilometers from the Oulu site. The acquisition will create synergies with Stora Enso’s packaging board production, supplying wood chips, pulpwood, and biomass directly from Junnikkala’s sawmills to the Oulu plant.
“This acquisition sets a strong foundation for our wood procurement as we prepare for the start-up of our new packaging board line in Oulu,” commented Hans Sohlström, President and CEO of Stora Enso. “It will enhance our operational efficiency and further optimize the integration between our Oulu site and the sawmills, while also reinforcing our wood product offerings.”
The acquisition aligns with Stora Enso’s strategic goals to secure an efficient and sustainable wood supply in the Baltic Rim market. Annual wood procurement in Finland will increase by an estimated 1.7 million cubic meters, and saw-milling capacity by 700,000 cubic meters. The addition of Junnikkala’s assets and resources will not only stabilize the supply chain but also improve cost efficiency and resource management, reducing waste and maximizing the use of wood from forest operations in Finland.
Junnikkala Oy’s sawmills will be incorporated into Stora Enso’s Wood Products division, while wood procurement activities will be aligned with the company’s Forest division. The transaction is expected to generate approximately EUR 15 million in annual synergies once Junnikkala’s new Oulu sawmill is fully operational. Notably, there will be no operational impacts on Stora Enso’s existing sawmills, while the workforce of Junnikkala—230 employees—will transition to Stora Enso.
Junnikkala reported sales of EUR 115 million in 2023, following a record EUR 141 million in 2022, highlighting the company’s established presence in the wood products sector.
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