MSEK 175 to be invested in Iggesund. Domsjö Sawmill to be phased out

On Wednesday, Holmen's Board decided upon a new strategy for Iggesund
Timber, the Group's sawn timber business area. The strategy has a distinct
niche orientation, and will involve further concentrating the product
portfolio on already established semi-manufactured products of Nordic
pine. Focus will be on Nordic pine products intended for industrial
customers manufacturing consumer products with exposed wood décor and/or
structure for homes and domestic environments.

As one stage in this new strategy, the Board decided to invest MSEK 175 in
a new finishing unit at the Iggesund Sawmill. The investment project,
which will be completed in 2002, will extend the sawmill's capacity to
produce highly processed and customised products, as well as providing a
better environment for the development of new products.

The investment project will result in a reduction in the work force at the
Iggesund Sawmill of some 50 employees, and the discontinuation of the
operations at Håstaholmen, in Hudiksvall.

As a consequence of the niche strategy, the Board has instructed the
management to phase out the Domsjö Sawmill. The closure is expected to be
completed by the end of June 2001 and affects around 70 employees.

Iggesund Timber's results have been unsatisfactory for several years. The
measures now announced will lead to an improvement in the operating result
as of the end of 2002. Once the strategy has been fully implemented,
profitability is expected to be good and to generate added value for
Holmen's shareholders.

During the current year, the structural measures will involve a charge of
MSEK 70 being taken against Iggesund Timber's result.

For further information, please contact Per Ericson, President and CEO of
Holmen (tel: +46 8 666 21 00),
or Johan Hedin, President of Iggesund Timber (+46 650 280 00).