“We have worked intensively on the proposal for a year and have evaluated several different variants. It turned out that a break might be a little easier than we thought from the beginning, when the forest products business is not at all integrated with the hygiene part. We were simply clear with the first step in the process “, says CEO Magnus Groth Direkt about the timing of the announcement.
the company chose to propose a dividend of hygiene market, which accounts for 85 percent of sales, rather than the minor forest products business has purely practical explanations, according to the CEO.
“it was the easiest and most cost effective way. the forest resources are today distributed in both the parent company and the forest Products business area. By sharing out the hygiene, the entire forest operations remain in a company, “he says.
the name SCA remains the name of the forest industry company, which is appropriate for historical reasons, says the CEO. For the new hygiene company remains to find a new name.
“We see this as an opportunity to create new energy in that part of the company, then we can focus forward on both consumer and business-to-business portion. the whole area of hygiene-health-wellness will naturally formulated in the new name. we will then be able to communicate in a much clearer way than before, when we were both hygiene and forest company “, says Magnus Groth and suggests that a hefty marketing campaign is waiting ahead.
After splitting the proposal is now launched to the details, including the name issue just begin. A new name should be in place before the demerger takes place during the second half of 2017.
“We will look at existing brands within the company, and of course something completely new,” says Communications Joséphine Edwall-Björklund.
SCA stock market rose more than 10 percent in Wednesday morning trading. Also Holmen, also with large forest holdings and Lundbergs as a major shareholder, rose significantly. Analysts have for years suggested various combinations of SCA and Holmen’s forest assets.
Have you thought of something the next step in terms of structure, after the split?
“It’s a giant step we take today, as we begin work to develop a proposal for the division. New forest SCA will be extremely attractive and financially strong with its extensive forest holdings, well-integrated and well-invested industrial part, responds Magnus Groth .
Graph: SCA share price performance in 2016
Source: Infront
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