Metso Corporation's Board of Directors has completed a strategy study and concluded that going forward a demerger would offer the best potential for its Pulp, Paper and Power businesses, as well as its Mining and Construction and Automation businesses to utilize their respective strengths in their customer industries faster and more efficiently, according to an official announcement.
Metso's Board approved on May 31 a demerger plan to transfer all the assets, debts and liabilities of Metso's Pulp, Paper and Power businesses to a newly formed company that will be named Valmet Corporation. Following the demerger, Metso's current Mining and Construction and Automation businesses would remain in the current company, which would continue to operate under the Metso name. Valmet would initially have the same ownership structure as Metso and would be totally independent without any cross-ownership between Metso and Valmet.
The demerger will require the approval of an Extraordinary General Meeting of Metso, and the registration of the completion of the demerger with the Finnish Trade Register following the creditor hearing process pursuant to the Finnish Companies Act. If approved, the planned registration date of the completion of the demerger is Dec. 31, 2013, and public trading in new Valmet shares on NASDAQ OMX Helsinki is expected to commence as soon as possible thereafter.
Matti Kähkönen, Metso's President and CEO, said in the announcement: “Based on preliminary feedback, I am convinced that both our customers and our personnel—both in the Pulp, Paper and Power businesses and in the Mining and Construction and Automation businesses—would benefit from the independent governance and strategy that two separate companies would offer."
Metso plans to hold an Extraordinary General Meeting on or about Oct. 1, 2013 to decide on the demerger and other Board proposals based on the demerger plan.