Norske Skog will enter the packaging market. The company will invest 1 billion Norwegian kroner to convert a paper machine in Austria into corrugated board production.
Norske Skog has previously announced plans to enter the European packaging market.
In a stock exchange announcement on Friday, the paper producer wrote that it has made an investment decision to convert a paper machine at the Brook factory in Austria to the production of corrugated cardboard based on recycled paper.
The investment amount is 100 million euros, which is slightly more than 1 billion Swedish krona at the current exchange rate. The report said that the bank will provide 70 million euros in financing, and the remaining funds will be paid by cash and cash flow on the company’s books.
Bruker’s production capacity will be 210,000 tons. Norske Skog’s plan includes two such conversion projects. The goal is to become a leading European manufacturer of environmentally friendly corrugated cardboard.
The plan proposed in June 2020 includes a total investment of 350 million euros in Golbey plants in Austria and France.
Norske Skog writes that by 2025/2026, the two modified machines are expected to generate an annual operating profit of 700-800 million Norwegian kroner.
The investment decision of the French factory is expected in the second quarter of this year.
Corrugated board production in Austria will start in the fourth quarter of 2022, and full production is expected in 2025.