JONKOPING, Sweden, March 1, 2002 (PRIMEZONE) -- The Board of Directors (1) of Munksjo AB (publ) ("The Board") has considered the unsolicited public offer ("the Offer") from Smurfit Holdings AB ("Smurfit"), a wholly owned subsidiary of Jefferson Smurfit Group plc , to the shareholders and holders of convertible loan notes in Munksjo AB (publ) ("Munksjo") dated 18th February, 2002.
The Board, which has been so advised by Lazard, believes that the Offer from Smurfit does not fully reflect the value of Munksjo's business and future potential, and accordingly recommends that shareholders do not accept the Offer.
The Board wishes to point out the following to shareholders:
-- Fourth quarter 2001 earnings are not reflected in the Offer.
The Offer was launched just after the publication of Munksjo's
year-end report for 2001 and the share was suspended between
these two events. Earnings in the fourth quarter of 2001 were
significantly higher than expected.
-- Positive developments to continue in 2002. The Board currently
expects Munksjo's full year 2002 earnings to reach the upper end
of analysts' forecasts (SIX Market Estimates 25th February, 2002).
The estimated earnings improvement compared to 2001 is directly
attributable to a number of factors, primarily a completed
turn-around of the Italian decor paper operation and a marginal
volume increase in Paper.
-- Munksjo's value is not reflected in the Offer. The Offer
proposed by Smurfit values Munksjo at a slight discount to market
valuations of medium-sized paper companies in the Nordic region.
Furthermore, under the terms of the Offer, shareholders will not
receive an amount corresponding to the SEK 3.25 dividend for 2001
which has been proposed by the Board.
-- Munksjo has invested significantly in its business. Munksjo has
made significant capital expenditures to increase capacity and
stands to reap the rewards of those investments as its markets
recover. In particular, Munksjo has increased its capacity in
decor paper, and during 2001 operated at approximately 70 per
cent of full capacity. Over the next couple of years, the Board
expects substantially improved capacity utilisation which will
result in highly improved profitability for the decor business.
During the coming years, the investment level in existing
facilities will be lower than in the past.
-- Munksjo is in discussions regarding significant potential
acquisitions in its core specialty paper business. If a
transaction is satisfactorily concluded, a substantial earnings
enhancement will be possible.
-- Munksjo has a good future as an independent company. The Board
believes that Munksjo has a good future as an independent company.
Munksjp is a world market leader in a number of niche markets for
specialty paper. In particular, Munksjo is a world leader in
decor paper, a market which over time has shown strong growth
(estimated long-term volume growth rate of 8 per cent per annum).
The Board will consider strategic alternatives for the company.
The Board will inform shareholders of developments when and if appropriate.
The Board recommends shareholders not to accept the Offer.
Presentation to Shareholders and Analysts Shareholders and analysts are invited by Anders G Carlberg and Per Rodert to a presentation of the Board's recommendation on Friday, 1st March, 2002 at 13:00 CET at Salen Konferens & Matsalar, Norrlandsgatan 15, Stockholm, conference room Olympia.
This statement is, in all essential respects, a translation of the Swedish statement. In the event of any difference between this translation and the Swedish original, the Swedish statement shall govern.
(1) Board members Anthony P J Smurfit and Francois Vittoz are due to
conflicts of interest not parties to this statement.
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