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Monday, February 26, 2024

Norske Skog seeks state support

Debt-burdened Norwegian forestry firm Norske Skog is on the verge of avoiding bankruptcy, but still hopes to receive some state support in the form of tax relief and changes in some other regulations. Norske Skog’s chairman Christen Sveaas, viewed as the company’s saviour, reportedly has “reminded” the government’s minister for business and trade about its requests.

“They weren’t my idea,” Sveaas told newspaper Dagens Næringsliv (DN) in confirming the aid effort worth around NOK 140 million to the company. Sveaas, who managed to win consensus on a rescue plan last week, said the company has “had a dialogue” with the state before he stepped it.

“When I became new chairman, I thought it was appropriate to remind the ministry about the (support) issues,” Sveaas told DN. “They are very important for the company’s competitive situation, but are independent of the refinancing.”

Norske Skog, one of the world’s largest producers of newsprint and magazine paper, wants the state, for example, to remove a tax on electricity used by the forest products industry. That along could save the company as much as NOK 20 million per year. Other measures include regulatory changes and the ability to use ash for commercial products other than just fertilizer.

“It’s critical that the Norwegian framework is, to the highest possible degree, in harmony with our biggest competitors in Sweden and Finland,” Sveaas told DN. Trade Minister Monica Mæland noted late last summer that Norske Skog, which faces another deadline this week for creditor approval of its rescue and recapitalization plan, is “an important company for timber industry” but she said the company itself must address its problems. It was not relevant at the time, she said, for the state to get involved. staff



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