Holmen is to buy back hydroelectric power assets on the Umeälven river
with a capacity of 541 GWh for a total of just over SEK 1.7 billion. The
transaction will be completed at the turn of the year 2002/03 following
Holmen's decision to exercise its option to buy back the assets, which
were sold in 1983 under a "partner-financing" arrangement.

The Holmen Kraft business area already has responsibility for the power
produced by the power stations concerned in return for paying agreed
compensation to the partner-financiers.

The buy back will improve Holmen's pre-tax result by approximately MSEK
45 per year with effect from 2003 as its operating result will improve
by some MSEK 135. At the same time interest on the cost of financing the
purchase is estimated to increase the Group's net financial items by
some MSEK 90 per year.

The Group's debt/equity ratio will increase by some 0.1 as a result of
the transaction.

Once the purchase has been completed, Holmen will own some 920 GWh of
hydroelectric power capacity, over and above which Holmen disposes of
some 170 GWh of partner-financed power.

If you have any questions, please contact

Göran Lundin, President and CEO, tel. +46 8 666 21 00
Anders Almgren, CFO, tel. +46 8 666 21 00 alt. +46 70 644 51 74
Åke Eklöf, President Holmen Kraft, tel. +46 660 754 00 alt. +46 70 574 49 44

Holmen AB, P.O. Box 5407, SE-114 84 Stockholm, Sweden.

Visiting address: Strandvägen 1, Stockholm.

Tel: +46 8 666 21 00   E-mail: info@holmen.com

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