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Norske Skog Sells Follum Site to Viken Skog

Lysaker, Norway, 26 March 2012 -- After the decision to close the mill at Follum, Norske Skog has worked to find relevant stakeholders to create new activities on the site. Norske Skog considers it a good solution that others can now take over further development development of the site.

"Norske Skog is very pleased that Viken Skog will now take over the work to create new activities at Follum. It has been important for us to find a buyer with ambitions for the future, with support from Buskerud county council, Ringerike municipality council, and regional businesses, and not least from the trade unions at Follum. I wish Viken Skog and the Ringerike region luck with the exciting development work," said Sven Ombudstvedt, president and CEO of Norske Skog.

"Viken Skog will develop a new, future-oriented forest-based industry cluster at Follum. The location and the existing infrastructure, in the heart of Norway's richest forest areas, make Follum a natural center for an offensive strategy. It will be a milestone for the Ringerike region that Follum will now become a center for sustainable development of environmentally friendly products from the forest. We have had good cooperation with the Ministry of Trade and Industry in the process of forging our long-term industrial plans. We now expect the government to implement measures to promote innovation and research in forest-based industries, in order to contribute to the huge effort we now face," said Ragnhild Borchgrevink, managing director.

The net sales proceeds are in the order of NOK 60 million. The sales price will be payable upon acquisition. The acquisition will take place in the second quarter of 2012. The sale will be implemented through Viken Skog purchasing Norske Skog Follum AS and Follum Industripark AS, and all properties related to the mill site, including Årbogen. Norske Skog will disassemble and retain parts of the technical production equipment. Norske Skog will discontinue production at Follum on 30 March 2012.

Sale of the Follum site will generate a total accounting gain in the order of NOK 30 million. This will be recognized in the first quarter of 2012. DHT Corporate Services and Advokatfirmaet Haavind AS acted as Norske Skog's financial advisors.


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