Holmen: Wargon Mill -- New Organization will Lead to 50 Job Cuts

Stockholm, SWEDEN

STOCKHOLM, Sweden, June 3, 2003 (PRIMEZONE) -- Holmen (LSE:HOLMbq):

An action programme has been approved for Wargon Mill, a coated printing paper mill within Holmen Paper.

The programme includes the introduction of a new organisation, which will lead to some 50 job cuts -- in addition to the 25 announced in connection with the closure of the mill's sulphite pulp mill this autumn. The Wargon mill, which is located in Vargon, (in the municipality of Vanersborg) some 70 kilometres north of Gothenburg, currently has 375 employees.

The action programme is drawn up in response to the unsatisfactory return by the mill for some time and the considerable excess capacity and depressed prices on the market for coated printing paper.

Apart from personnel cuts, the plan includes measures to improve the quality of the paper. The Wargon mill has the capacity to produce 130,000 tonnes of paper a year.

Negotiations on the new organisation are now in progress.

For further information, please contact Magnus Hall, President of Holmen Paper (+46 11 23 50 00), or Rikard Wallin, Manager at Wargon Mill (+44 521 27 75 00).

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