Stora sells its merchant paper business

Stora Enso said on Thursday that it has agreed to sell its merchant paper business, Papyrus, to Altor Fund II for an enterprise value of around €640m (US$979.5m).

The transaction consideration consists of approximately €490m in cash, approximately €93m of net liabilities assumed by the purchaser, and a vendor note of €57m.

The sale is expected to be finalised in the second quarter of 2008, subject to customary statutory approvals. The cash proceeds from the transaction will be used to pay down Stora Enso’s debt.