Stromsdal to file for bankruptcy following failure of restructuring attempts; blames economy on weak orders

Mathew Kearney

HELSINKI , November 27, 2008 (press release) – Stromsdal has this morning received information from Primaca Partners Oy that the EUR 5 million equity injection which was a part of the signed and published Letter of Intent (LOI), dated October 30, 2008, has failed dispate continues negotiations, due to the tight financial market situation. While the LOI required that all parts of the LOI to be fulfilled and this is not now happening, then there are no chance for the corporate and financial restructuring to take place.

The sudden standstill of the world economy and the tightening of the financial market have weakened the order intake. Recently published negative economic indicators and despite raw material prices coming down, the best estimate is, that the company operative cash flow will not turn positive this year.

The company has also today received information from its main financiers that they are not willing to input any more money. The company has also explored other financing possibilities, but without success. Taking the above circumstancies into account the Board of Directors has in its meeting today decided on behalf of Stromsdal Corporation to file for bankruptcy in the city court.

“We are very sorry that the world economy crisis and the international finance crisis distroyed our last years’ huge financial and labour inputs done for Stromsdal and developing its excellent packaging products, mill productivity and sale improvements.

We are especially sorry for the employees and their families, City of Juankoski, customers, shareholders and financiers and other stakeholders, but in the end there were no other options.

We thank all those who have supported our business during all these years.”, declares Company Management and the Board of Directors.

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