Norske Skog board of directors recommends closing newsprint, magazine, book paper production at its Follum, Norway, paper mill, says influence of electronic media has lowered paper sales, company must close least competitive mill

OXENOEN, Norway , December 7, 2011 (press release) – The Board of Directors of Norske Skog recommends closing production at Norske Skog Follum. Tomorrow, Thursday, the matter will be presented to the Corporate Assembly of Norske Skog.

If the Corporate Assembly upholds the recommendation of the BoD, the production at Follum will according to plan cease no later than 31 March 2012.

The decision of the BoD was reached against the vote from the Follum employee representative.

- Norske Skog sells less paper than before since many replace paper with electronic media. We unfortunately no longer need as many paper mills, and therefore the least competitive mill has to be closed first, says Chair of the board Eivind Reiten at Norske Skog.

- The majority of the board has concluded that no justifiable alternative to a closure exists. This is regrettable towards the employees at Follum. We have been negotiating with Viken Skog regarding a potential sale. It has however not been possible to reach an agreement which is viable both in a market and an economic sense, says Chair of the board Eivind Reiten at Norske Skog.

Norske Skog Follum is located in the town of Hønefoss, Norway and has 356 employees. The mill produces improved newsprint, magazine paper and book paper. Annual production capacity is 290 000 tonnes.

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