Vapo and Tornator agree a deal on more than 5,000 hectares of land
Less than a year ago, Vapo Oy announced its intention to start selling land not necessary for its current or future business from its balance sheet as individual transactions. At the time, Vapo Oy owned about 100,000 hectares of land, more than 20,000 of which was used for peat production. The rest of the land, i.e. about 80,000 hectares, consists of various forms of productive forest land and reserve areas procured for peat production needs.
One year ago, the company set a target of selling about 50,000 hectares. The land to be sold is similar to that covered by the transaction between Vapo Oy and Tornator: areas removed from production and now viable as arable land, protected sites and wetlands suited for hunting, among other things. Since last October, about 10,000 hectares of land have been sold, including this transaction.
According to Vesa Tempakka, CEO of Vapo Oy, this project to release funds for the development of core business has proceeded even slightly faster than originally planned. “We knew in advance that there is demand for good woodlands and arable land in certain areas, but investors’ interest in various wetlands and even in young forests has been a positive surprise. We have reserved three more years to fulfil our entire sales objective and I believe it will be enough, unless something unexpected happens with trade cycles,” says Tempakka.
Tornator Oyj owns a total of approximately 690,000 hectares of forest in Finland, Estonia and Romania. Last year, Tornator invested more than EUR 100 million in the purchase of forests. This year, the company’s forest investments continue. Including this transaction, the company so far has purchased about 15,000 hectares of forest in 2018. Most of the transactions are 50–100-hectare estates from private forest owners. “Our reputation as a reliable, competitive and sustainable buyer has clearly spread among forest owners,” says Sixten Sunabacka, CEO of Tornator Oyj.
Sunabacka is happy about the forest estate transaction with Vapo as it supports Tornator’s growth strategy: “We plan to utilise the purchased areas for sustainable forestry, continue the reforestation of areas removed from peat production and restore the mires that are the hardest to reforest to their natural state. Tornator will not engage in peat production in the purchased areas. The growth will enhance our ability to draw sustainable well-being from forests and act as a pioneer in the responsible use of forests.”
More information:
– Pasi Koivisto, Director, Strategic Projects ＆ Real Estate, Vapo Oy
tel. +358 (0)40 848 6541, e-mail: pasi.koivisto@vapo.fi
– Sixten Sunabacka, CEO, Tornator Oyj
tel. +358 (0)40 036 6148, e-mail: sixten.sunabacka@tornator.fi
Vapo is a conglomerate that operates in Finland, Sweden and Estonia. Our operations are focused on growing and recycling, the production of solid fuels, heating, electricity and steam as well as the provision of various energy solutions. We also develop new products from peat and other natural materials.
Our business is divided into three divisions: Energy, Grow&Care and New Businesses. The Supply Chain Management function used by all three business divisions manages peat production in various countries, logistics services and procurement, among other things. Group services are managed by the Group Service function. Today, we employ about 700 people in Finland, Sweden and Estonia.
Tornator is a leading European company specialising in sustainable forestry. The company owns forests in Finland, Estonia and Romania. The Group’s turnover in 2017 was approximately EUR 102 million and the balance sheet approximately EUR 1.5 billion. The Group directly employs about 200 people. All in all, the company’s forests employ directly its own staff as well as entrepreneurs and their employees for about 900 person-workyears. Tornator is among the 60 largest corporation tax payers in Finland. The owners of the parent company are Finnish and mostly institutional investors. Tornator’s mission is to draw sustainable well-being from forests. www.tornator.fi