Swedish wood products producer Setra Group AB has launched a SKr500m new shares issue to pay down debt and invest in the business.
The company said the issue was needed to restore its balance sheet and also develop the business further, including possible acquisitions.
Setra’s three principal owners Sveaskog, Mellanskog and LRF have given an undertaking to subscribe to 100% of the new shares, with the subscription period set at June 12-26.
Setra president and CEO Kent Torwald acknowleged the difficult market environment in 2008 and so far in 2009, but said Setra had returned to a positive cash flow in April and anticipated breaking even in a short time.
Mr Torwald also predicted timber shortages in the next quarter due to reduced harvesting rates, increased log prices and widespread production curtailments.
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