CONSOLIDATION: VALMET, RAUMA UNITE TO FORM $7B FOREST GIANT

Pulp & Paper Canada
December 31, 1998
By Pulp & Paper Canada
HELSINKI, FINLAND -- Paper machine maker Valmet Corp. and forest machine manufacturer Rauma Corp. will merge to form one of the world's largest forest machine equipment makers. The merged company -- tentatively named Valmet-Rauma Corp. -- will be Finland's largest metal company, with combined annual sales of about $7 billion and almost 23 500 employees.

The companies did not mention staff layoffs, But they did say they expect to save about $120 million in such duplicated services as distribution, purchasing, manufacturing and administration. Process automation and flow control will be a key growth area for the new company.

In the new company, each Rauma shareholder will receive 1.08917 shares and, and each Valmet shareholder one share. The largest shareholders of both companies say they will approve the merger: UPM-Kymmene Corp. as the largest shareholder in Rauma with a 34.5% stake, and the Finnish government as the major shareholder in Valmet with a 20% interest. In the merged company, Matti Sundberg, chief executive officer of Valmet, will be CEO, while Pertti Voutilainen, chairman of Rauma, will be chairman. The merger must meet the usual approvals from regulatory authorities and shareholders. It is expected to be completed by June 30, 1999.

Add comment

Disclaimer
Note: By submitting your comments you acknowledge that Pulp and Paper Canada has the right to reproduce, broadcast and publicize those comments or any part thereof in any manner whatsoever. Please note that due to the volume of e-mails we receive, not all comments will be published and those that are published will not be edited. However, all will be carefully read, considered and appreciated.


Security code
Refresh

Subscription Centre

 
New Subscription
 
Already a Subscriber
 
Customer Service
 
View Digital Magazine Renew

Most Popular

We are using cookies to give you the best experience on our website. By continuing to use the site, you agree to the use of cookies. To find out more, read our Privacy Policy.