Investment in Kotkamills

In 2012, Powerflute acquired a minority stake of 10% in Kotkamills, a large integrated mill complex located in Kotka, Finland with annual sales approaching €300 million. Kotkamills produces a range of specialty papers, including paper and films for the construction industry and high-bulk MFC publication papers, and operates one of the largest saw mills in Finland.

During the period from 2012 to 2015, Powerflute assisted the majority owner and the management in their efforts to improve operational and financial performance in the face of very challenging market conditions. Good progress was made in improving operating efficiencies and productivity across all four business lines and profitability improved considerably.

In February 2015, the majority owner of Kotkamills exercised its rights under a shareholder agreement to acquire Powerflute’s minority interest in the company as a part of larger transaction that will see the business sold to a new investor who has plans for further development and expansion. This transaction was completed in March 2015.

Powerflute generated a significant return on its original investment in Kotkamills and we are pleased that the business prospered as a result of our involvement and will now go on to benefit from significant investment and development into new products and markets under its new owners.