Holmen's Hallsta Paper Mill in Hallstavik, just north of Stockholm, Sweden, is today starting union negotiations regarding the previously announced cost reduction programme. The mill currently has an established work force of around 1,000 positions, but this will have been reduced to approximately 900 by the autumn of 2005. The object is to maintain the mill's long-term competitive strength and improve its profitability.

"We are about to open negotiations with representatives of the unions, and our aim is to achieve our goal without making anyone redundant," explains Per Bjurbom, mill manager at Hallsta Paper Mill.

"We need to improve our results and raise the profitability of the mill. Our fixed cost base is too high, so we have to not only increase production but also adjust the number of positions if Hallsta is to have a long-term future as a competitive supplier on the market," adds Bjurbom, "and be able to continue as a large and important employer in the region."

The reduction in positions will affect blue-collar as well as white-collar employees. In financial terms, it corresponds to a cost reduction of some MSEK 50 per year and is estimated to have full impact by the second half of 2005.

For questions, please contact mill manager Per Bjurbom, tel +46 175 260 00.