Stora Enso announces asset restructuring.

STORA ENSO ANNOUNCES ASSET RESTRUCTURING. Stora Enso, Helsinki, Finland, will build a new paper machine at Kvarnsveden, Sweden. This machine was first announced in October 2002 as part Stora Enso's asset restructuring program. Other newly announced investments fall within Stora Enso's target of keeping capital expenditure at or below the level of depreciation over the cycle.

* A new uncoated magazine paper machine at the Kvarnsveden Mill in Sweden that should start up at the end of 2005 will cost approximately EUR 450 million (US$ 553 million). The aim is for the investment cost per metric ton to remain below EUR 1000 (US$ 1230). It will produce 420,000 metric tons of high-quality, super-calendered (SC) papers annually.

* Paper Machine 9 at Kvarnsveden Mill with its 130,000 metric ton annual capacity will close when the new SC machine starts up.

* Paper Machine 6 at the Maxau Mill, Germany, will be rebuilt. It produces SC-B paper made from recovered fiber. When the new paper machine at Kvarnsveden starts up, paper machine 3 at Langer-brugge Mill that has an annual capacity of 165,000 metric tons will change from making mainly high-quality SC to exclusively SC-B paper. This will allow Langer-brugge to maximize use of recycled fiber.

* When the Kvarnsveden machine starts up, Stora Enso will also cease non-competitive production of SC paper on paper machine 5 at Wolfsheck Mill in Germany. Stora Enso is investigating other options for the machine.