Plans to close mills in Scandinavia have been followed by an announcement that Stora Enso will sell its Sachsen newsprint mill in Germany.

The news follows that of UPM selling its Shotton newsprint mill in the UK to a Turkish maker of corrugated and containerboard.

Stora is selling the Sachsen mill in Eilenburg to the Swiss family-owned business Model Group, with an agreement that it will make newsprint for 18 months before switching it to containerboard.

Sachsen’s capacity of 310,000 tonnes will be sold and distributed by Stora until the agreement expires, and all 230 employees will move to Model.

The transaction is valued at 35 million Euros, and will have no material impact on Stora’s operational EBIT or net debt, the company says. It will book a one-time cost of approximately 32 million Euros in its IFRS operating profi.

In April, Stora outlined plans to close pulp and paper production at its Kvarnsveden and Veitsiluoto mills in Sweden and Finland, affecting 1110 jobs.

Stora says the pandemic has accelerated the decline in paper demand in Europe which had been happening for the past decade. Both Kvarnsveden and Veitsiluoto had been operating at a loss.

President and chief executive Annica Bresky says Stora is shaping its business for accelerated growth and value. “We are focusing on packaging, building solutions and biomaterials innovations, where we see strong growth potential,” she says.

The mill closures will reduce Stora Enso’s paper production capacity by 35 per cent to 2.6 million tonnes per year, making its paper division’s sales just over ten per cent of the group’s activities.

Stora said in April it continued to produce woodfree uncoated office papers at its Nymölla mill in Sweden, supercalendered papers at Langerbrugge in Belgium and Maxau in Germany, machine-finished coated papers and coated and uncoated book papers at Anjala in Finland, standard newsprint at Langerbrugge and Hylte in Sweden, and improved newsprint and other newsprint specialities at Anjala in Finland. At the time of the April briefing to media, Sachsen (pictured) was also in that list.