Swedish state-owned forestry company Sveaskog has done a U-turn and will not sell the AssiDomän sawmilling operations after all.
Sveaskog acquired the outstanding shares in AssiDomän at the end of 2001 for US$1.5bn and originally intended to keep the company’s forestlands and sell its sawmills.
However, Sveaskog chairman Bo Dockered said it would now be developing a strong sawmilling business and AssiDomän Timber would be a long-term asset.
He said: ‘We have now made a thorough revision of the operation and we found that a woodworking business is vital for the overall goals of long-term growth in value of Sveaskog’s forest holdings.
‘About 70% of the income from the forest holdings come from sawn timber. That means a powerful and profitable woodworking industry is needed to make forestry profitable in the long term.’
Mr Dockered said the Swedish sawmilling industry suffers from over-capacity and weak profitability. By acting with other players in the industry, it intends to bring ‘structural transformation’ to improve profitability.
