Feb. 1, 2021 (Press Release) - Stora Enso has decided to permanently close its US-based Virdia operations during 2021. Virdia was acquired in 2014 and has focused on conversion of cellulosic biomass from sugar cane bagasse into refined sugars. The operations have consisted of a research center in Danville, Virginia and a demo plant in Raceland, Louisiana, which will both be closed.
The closure is in line with Stora Enso's strategic choices in R&D to drive future growth and value creation from forest-based materials. Furthermore, today, the company's innovation work focuses considerably more on applications further down the value chain instead of being a raw material supplier. There will be a stepwise process for discontinuing the operations and closing the sites during 2021. The employee impact will be approximately 65 Stora Enso employees and 18 contractors.
The asset write downs and provisions were booked as items affecting comparability (IAC) of EUR -53 million in Stora Enso's fourth quarter 2020 results. A further EUR -6 million of items affecting comparability are expected to be recorded in the Q1 2021. The closure will not have material impact on Stora Enso's sales.
In its US-based operations, Stora Enso has been studying alternatives for separation technologies that enable cellulosic biomass, such as bagasse, to be converted into highly refined sugars. The company has gained insights from this research for its innovation work, which will be of benefit in future applications. The intellectual property belongs to Stora Enso for further use by the different businesses in the company.
Stora Enso is committed to a safe and orderly closure of operations and will honor existing contractual obligations and liabilities with relevant stakeholders as required and deemed appropriate. Stora Enso will provide support for its local employees throughout the shutdown process.
Part of the bioeconomy, Stora Enso is a leading global provider of renewable solutions in packaging, biomaterials, wooden constructions and paper. To learn more, please visit: www.storaenso.com.
SOURCE: Stora Enso
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