STOCK EXCHANGE RELEASE 13 Dec 1999
JAAKKO PÖYRY GROUP REINFORCES ITS STRATEGY BY MAKING AN ACQUISITION IN FRANCE AND BY REORGANISING ITS BUSINESS OPERATIONS
FOCUS OF GROUP STRATEGY
The objective of the Jaakko Pöyry Group is to concentrate on three core business areas: forest industry, energy, and infrastructure and environment. Specialised know-how related to the forest industry is concentrated in the Nordic countries, where there is a cluster of major forest industry customers, machine suppliers, research and educational institutions and engineering firms.
Energy expertise in the areas of thermal power and waste to energy is primarily found in Central Europe, and in the areas of combined heat and power generation and biofuels, in the Nordic countries, Central Europe and Asia. The Group's know-how in the area of oil and gas is concentrated in the Middle East.
The Infrastructure and environment business group's transportation know-how is concentrated in Central Europe. Know-how related to water and waste water treatment and environmental protection is primarily found in the Nordic countries and Central Europe.
The Jaakko Pöyry Group's clients are globalising and consolidating their operations in many areas of the world. The Group assists its clients in this consolidation process through its global network of offices by serving as an adviser and implementing projects. The Jaakko Pöyry Group's local network of offices offers clients a good alternative for outsourcing their internal engineering services.
EXPANSION OF OPERATIONS IN FRANCE
To implement the strategy described in the foregoing, the Jaakko Pöyry Group has on December 10, 1999 acquired a 70 per cent interest in two French engineering firms: Beture-Environnement S.A. and Beture-Cerec S.A. With combined net sales of about EUR 15 million in 1999, the two companies employ a total of about 135 people. Their main offices are situated in Paris and Lyon. The companies' current owner Groupe Beture will retain a 30 per cent shareholding in the companies.
Relying on French technology and financing, these companies have also provided engineering and project implementation services for projects in Asia, Eastern Europe and Northern Africa.
The business of Beture-Environnement S.A. is primarily concerned with engineering, implementation and maintenance supervision services for district heating plants and systems in France. The company does also engineering of waste to energy plants and municipal waste handling systems. The objective of the Jaakko Pöyry Group is to expand its market share in the growing French market for combined heat and power generation (CHP).
The net sales of Beture-Environnement S.A. amount to about EUR 9 million, and it has 50 employees. The company's head office is situated near Paris. The company will become a part of the Electrowatt-Ekono energy business group.
The business of Beture-Cerec S.A. is primarily related to engineering, implementation and maintenance supervision services for water and waste water treatment plants in France. In addition, the company has been involved in projects for example in Asia and Northern Africa.
The objective of the Jaakko Pöyry Group, via Beture-Cerec S.A., is to expand its know-how in the area of water and waste water treatment technology. French technology and operators in this sector are among the most advanced in Europe. The French technology supplements the Jaakko Pöyry Group's Nordic know-how represented by Soil and Water Ltd, which is primarily concerned with the control of low-temperature water treatment processes.
Beture-Cerec S.A. has net sales of about EUR 6 million and a total of 85 employees. The company's head office is situated in Lyon. Beture-Cerec S.A. will be integrated into the Jaakko Pöyry Group's Infrastructure and Environment business group.
REORGANISATION OF BUSINESS OPERATIONS
To further strengthen the Group's focus on its three core areas of operations, the Jaakko Pöyry Group has decided to integrate its Process Industry business group into its Electrowatt-Ekono Energy business group. The change will become effective on January 1, 2000.
Following this change, the Energy business group will be able to offer its clients global know-how and local resources in all areas of energy technology, including combined heat and power generation, hydroelectric power, nuclear power, waste management and biofuels, oil & gas, energy management and environmental expertise.
In addition, the business group will also be able to serve its clients in the gas, oil and fuel ethanol sectors. JPI Process Contracting Oy in Finland and JPI Process Contracting S.N.C. in France have delivered several fuel ethanol plants to clients in Europe. Heymo S.A., which is a part of the Process Industry business group, is Spain's leading designer of gas pipelines. The company has about 200 employees. The French engineering firms Retma S.A. and SEEI S.A., which are also part of the Process Industry business group, supplement the Energy business group's local office network. These companies have a total of about 80 employees. At the same time, the Process Industry business group's forest industry turnkey projects department will be transferred to the Forest Industry business group.
Following the organisation change and the acquisition of Beture-Environnement S.A., the net sales of the Energy business group will amount to about EUR 135 million and it will have a total of about 1300 employees. It will be one of Europe's leading companies in its own area of expertise, being able to serve its clients globally.
After the organisation change, the Jaakko Pöyry Group's net sales, earnings and personnel will be divided as follows (pro forma January-September 1999, excluding Beture):
Net sales (EUR million)
|Forest industry||85.5||31 %|
|Forest industry consulting||28.9||10 %|
|Infrastructure and Environment||68.8||25 %|
Operating profit (EUR million)
|Forest industry||9.6||46 %|
|Forest industry consulting||0.5||3 %|
|Infrastructure and Environment||5.8||28 %|
|Forest industry||1551||37 %|
|Forest industry consulting||302||7 %|
|Infrastructure and Environment||1064||26 %|
JAAKKO PÖYRY GROUP OYJ
For further information please contact:
Mr. Teuvo Salminen, Executive Vice President, Jaakko Pöyry Group Oyj, tel. +358 9 8947 2872, +358 400 420 285
Mr. Jukka Nyrölä, President and CEO Electrowatt Engineering Ltd, Zurich/Switzerland, tel. +41 76 356 2451
Stockholm Stock Exchange