STORA ENSO is mulling over a series of structural changes that could result in the termination of more than 1,000 jobs in Finland, Estonia, Poland and the Netherlands.
The Finnish paper and packaging materials company revealed last week it is considering the permanent closure of its pulp mill in Kotka, Finland, a containerboard plant in the Netherlands, one of the production lines at its plant in Poland and a sawmill in Estonia.
The measures would result in the termination of 600 jobs, including 250 at the Sunila site in Kotka.
The company stated that it will additionally launch consultative negotiations within its group functions with a view to making about 300 office employees redundant. The consultative negotiations in its packaging materials division, meanwhile, have been mostly completed and are set to result in a reduction of around 250 managerial and support positions.
The restructuring measures are expected to reduce annual sales by roughly 380 million euros and consolidate operational earnings by 110 million euros.
Annica Bresky, the CEO of Stora Enso, on Thursday said in a press release that the measures are naturally “very difficult” and would not be proposed unless they were absolutely necessary for the company’s long-term competitiveness.
“We are at a critical juncture in our strategy advancement, and to advance our market position an increased focus on capital allocation and decentralised empowerment is needed,” she argued. “This sadly means that assets suffering from challenged profitability would need to be closed, in combination with a more streamlined headquarter organisation.”
The Sunila mill has an annual production capacity of 375,000 tonnes of long-fibre pulp, accounting for 13 per cent of the annual market pulp capacity of Stora Enso. The cost-competitiveness of the mill has eroded in a domestic market environment characterised by increased competition for pulp wood following the discontinuation of imports from Russia.
Stora Enso also said it has made no changed to its strategy for developing biomaterial innovations, meaning that its pilot facility for hard carbon-based battery material will continue to operate at Sunila.
Aleksi Teivainen – HT