GERMANY -- Stora Enso announced this week that it has signed an agreement to divest its Uetersen specialty and coated fine paper mill in Germany to a company mainly owned by the private equity fund Perusa Partners Fund 2.

Stora Enso said the cash consideration for the divestment of the shares is approximately Euro 7 million subject to customary closing day adjustments.

The company added that the loss on disposal amounts to approximately Euro 30 million and will be recorded as a non-recurring item in Stora Enso's fourth quarter 2014 results.

The transaction is in line with Stora Enso's strategic transformation to a customer focused renewable materials company. The transaction is expected to be completed in the first quarter of 2015 and is subject to regulatory approvals.

The transaction will enhance Stora Enso's operational EBIT and cash flow from the second quarter of 2015, the company said. Based on 2013 annual figures, the divestment is expected to reduce Stora Enso's annual sales by Euro 155 million. It will also reduce Stora Enso's annual paper production capacity by around 240,000 tonnes. Uetersen Mill employs approximately 400 people.

Stora Enso said it will continue to produce specialty papers at Imatra Mill and coated fine paper at Oulu Mill in Finland.

Stora Enso's previous attempt to divest the mill to Brigl & Bergmeister, an Austrian specialty paper producer, was unsuccessful due to the German Federal Cartel Office's (FCO) indicated intentions to prohibit the proposed transaction.