The European Investment Bank (EIB) is extending a EUR 160 million loan to the Stora Enso Group.

The financing is aimed for an investment programme at Stora Enso's pulp and paper mill in Imatra. Stora Enso is enforcing one of its core areas, liquid packaging board, where the company is the world's leading producer.

In addition to increased capacity, the project will have a positive environmental impact. The investments comprise i.a. construction of a new pulp line and equipment to treat liquid emissions and malodorous discharges. These will be brought well below the limits implied by the existing environmental permits.

The EIB Vice President for Finland, Sweden and Austria, Ewald Nowotny, says that the EIB is involved because the bank is keen to underpin efforts to support competitiveness of European industry.

"In addition, the investments meet the EU's and the EIB's objectives to promote environment protection."

The Stora Enso Group was formed through the 1998 merger of Sweden's STORA and Finland's Enso corporations. In February this year, Stora Enso announced the purchase of the US paper producer Consolidated Papers thereby creating the world's largest producer of pulp, paper and board in terms of capacity.

EIB-lending to the pulp and paper sector within EU amounted during the last five years to some EUR 1 billion.

Within the forest products industry in Finland, the EIB has previously extended a EUR 168 million loan to the UPM-Kymmene Corporation to finance a comprehensive investment programme. A FIM 450 million (approx. EUR 75 million) loan has been extended to finance modernisation of the Metsä-Botnia pulp mill in Joutseno.

During Finland's five years of EU-membership, the EIB has extended loans totalling some EUR 2.3 billion for infrastructure and industrial investments in Finland, as well as venture capital financing.

The AAA-rated EIB, the European Union's house bank, extends long-term financing for investments both within and outside the EU.