Ahlstrom corporation has signed an agreement to combine its Label and Processing business with Munksj� AB to form a new specialty paper supplier through two partial demergers: one consisting of the Label & Processing operations in Europe (LP Europe) and one in Brazil (Coated Specialties).

The new company will be called Munksj� Corporation and its shares will be listed on Nasdaq OMX Helsinki. The transaction enables Ahlstrom to focus exclusively on its Building and Energy, Filtration and Food and Medical business areas. Meanwhile, the Label and Processing business area can be further developed together with Munksj�.

‘During the past three years, Ahlstrom has systematically executed its strategy towards becoming a focused high performance materials company. This transaction of combining the Label and Processing business area with Munksj� is the most significant step in our strategy execution. It allows us to concentrate our resources to the areas where we see the most attractive value-add and growth opportunities,’ said Jan L�ng, president and CEO of Ahlstrom.

The other major step in the process of Ahlstrom focusing its business operations was the divestment of the Home and Personal business area to Suominen Corporation in 2011. Ahlstrom expects the future growth to be realized through organic growth as well as acquisitions and partnerships in the three business areas.

Following the public listing of the new company, Coated Specialties, the Brazilian part of Ahlstrom's Label and Processing business area, will be separated through another partial demerger into Munksj� Corporation. This is to allow enough time for receiving all the necessary regulatory approvals in Brazil. These approvals are not a prerequisite for completing the first phase and the public listing of Munksj� Corporation. The second phase is expected to be completed by the end of the second quarter of 2013.

There is a strategic fit between the Label and Processing business area and Munksj� AB with specialty papers as the core business. The transaction is also expected to create synergies in the range of 25-30 euros million once the transaction is fully implemented, mainly relating to purchasing, production, pulp, logistics and sales.

Munksj� Corporation will be one of the world's largest focused specialty paper companies. The transaction will also enable the Label and Processing business area to gain a position that ‘could not be achieved within Ahlstrom’.

In 2011, the Label and Processing business (the combined LP Europe and Coated Specialties) had net sales of 681 million euros. The business area employs approximately 1,500 people and has six plants in Europe and South America. Its main products include release liners, self-adhesive labels, base paper for metalized labels, flexible packaging papers, poster papers, decor papers and abrasive backings. The plants that will be part of the transaction include Osnabr�ck in Germany; La Gere, Rottersac and Stenay in France; the Label and Processing operations in Turin, Italy, as well as the Coated Specialties plant in Jacarei, Brazil.

Munksj� AB is a Swedish specialty papers company currently with private equity firm EQT as its main owner. The net sales of Munksj� on a pro forma basis totaled approximately 645 million euros in 2011. The company employs about 1,800 people and has ten plants in Europe and Asia. Its main products include decor papers, abrasive backings, electrotechnical papers and long-fiber specialty pulp.

Jan �str�m, president and CEO of Munksj� AB, will become the president and CEO of the new company. The head office of Munksj� Corporation will be located in Stockholm.

Following the completion of the transaction, the current Ahlstrom's site in Turin will be jointly operated by Ahlstrom and Munksj� Corporation. The Osnabruck plant, which will be part of the transaction, will continue to produce wallcovering materials for Ahlstrom.