Sylvamo sells Russian assets to local management for $420 mln

MOSCOW. Oct 7 (Interfax) - Sylvamo Corporation, a major paper producer which said in May that it was leaving Russia due to events in Ukraine, has sold its Russian assets to local management.

Sylvamo said in a press release that it closed the sale of the Russian operations to Pulp Invest Limited Liability Company for $420 million on October 6. Sylvamo received approximately $390 million in cash proceeds after foreign currency exchange rates and transaction fees. The conversion, according to the contract published by Sylvamo, was carried out through Raiffeisenbank.

The buyer is the newly established Pulp Invest LLC, owned by Timur Gabidullin, general director of JSC Silvamo Corporation Rus, whose shares are the subject of the deal.

The deal, including the $420 million amount, was approved by a subcommission of the government commission for foreign investment control in accordance with the current procedure in Russia, a source with knowledge of the situation told Interfax.

The Russian Industry and Trade Ministry confirmed to Interfax that the authorities have approved the Slyvamo deal. "A meeting of the subcommission of the government commission for foreign investment control in the Russian Federation was held on September 21, 2022. The subcommission unanimously made the decision to effect the Pulp Invest LLC deal entailing accrual of rights to the securities of PJSC Silvamo Corporation Rus," the ministry's press service said.

Silvamo Corporation Rus, in particular, manages the Svetogorsk Pulp and Paper Mill in the Leningrad region with annual capacity of 720,000 tonnes of pulp, paper, and cardboard. Russia accounted for approximately 15% of Sylvamo's total revenue in 2021.

Svetogorsk Pulp and Paper Mill produces office and offset paper, cardboard, and thermo-mechanical pulp for the domestic and foreign markets.