16OG Akbank 5.000% A

RNS Number:9383H
Perstorp AB
27 March 2000


Press information

Perstorp makes strategic acquisitions in chemical and flooring sectors

Perstorp has signed agreements regarding two strategic acquisitions in the
chemical and flooring sectors. The Group is to acquire one of Europe's largest
manufacturers of phenolic resins and a minority interest in one of Germany's
leading manufacturers of laminate flooring.

"The acquisitions are fully in line with our strategies for chemical and
flooring operations. They will enable us to improve our positions in several
of the segments in which Perstorp is strongest, both in Europe and on a global
basis," says Ake Fredriksson, Perstorp's President and Chief Executive Officer.

The acquired chemical company is Plasta Erkner GmbH, based in Erkner, close to
Berlin, which is part of Funk Chemie a German industrial group. The company has
annual sales of approximately SEK 240 million and is one of Europe's leading
manufacturers of phenolic resins, which are used in various applications, mainly
within the construction, automotive and engineering industries. The acquisition
will strengthen Perstorp Chemicals' position as one of Europe's largest
producers of phenol-based resins, particularly in the important German market,
as well as in Eastern Europe, while boosting the subgroup's production capacity.

The purchase price for the operations within Plasta Erkner corresponds to five
times the company's estimated EBITDA for 2000. The acquisition is expected to
make a favourable contribution to Perstorp's operations as early as during the
current year. In addition, the generated profits will not be subject to tax,
since the Perstorp Group has unutilised tax loss carryforwards in Germany. The
acquisition is subject to approval by German competition authorities.

In the flooring sector, Perstorp is to acquire 25.1% of the shares in the
German laminate flooring manufacturer Witex through a private placement of
shares. As a result, Perstorp Flooring's product range will be broadened to also
 include direct laminate flooring. Witex is a globally active flooring company 
that had sales of approximately SEK 1 billion in its most recent fiscal year, of
which flooring products accounted for 75%. According to the agreement, Perstorp
will also be able to increase its shareholding to 49% during 2002, subject to 
certain conditions.

As a result of cooperation With WitexR, Perstorp Flooring, whose main brand is
Pergo(R), will have immediate access to direct laminate flooring, an expanding
market segment. This cooperation is expected to lead to stronger market
positions and more efficient production and distribution operations in Europe,
the United States and Asia.

Production of Pergo(R) and Witex(R) flooring will be conducted on a parallel
basis at the Witex plant in Augustdorf, although the two brands will be marketed
independently. During the current year, capacity at the plant will be increased
sharply, at the same time as Witex builds a production plant for laminated 
flooring in the US and initiates a joint venture in Asia.

"Like Pergo(R), Witex Is renowned for its high rate of innovativeness, strong
brands and high quality. We also expect the joint venture to generate
considerable synergistic benefits in such areas as product and process
development, purchasing and logistics," explains Ake Fredriksson.

Perstorp's participation in Witex will take the form of payment for a private
placement of Witex shares based on a value of Witex which corresponds to six
times the company's estimated EBITDA for 1999. The contributed capital will be
used for continued investments in Europe, the US and Asia.

The total payment for the two acquisitions amounts to approximately SEK 350
million.

The Perstorp Group

Perstorp Chemicals and Perstorp Flooring are members of the Perstorp Group.

Perstorp Chemicals is a specialised global chemical company, with annual sales
of slightly more than SEK 4 billion and 2,250 employees. The company conducts
manufacturing operations in several European countries and in the US, South
America and Asia. Perstorp Chemicals focuses on high-value specialised chemical
products for industrial customers and has particularly strong positions in the
markets for polyols and resins, among others.

Perstorp Flooring is an expansive flooring company with world-leading positions
in the laminate flooring market. Europe and the US, where the Pergo(R) brand
holds strong market positions, account for most of the company's sales, with
South America and Asia generating smaller shares. Production operations are
conducted in Trelleborg, Sweden and Raleigh, North Carolina, USA. During 1999,
the subgroup had sales of slightly more than SEK 3.6 billion, with 880
employees.

Witex

In addition to direct laminate flooring, Witex produces laminate-based interior
fittings for the furniture industry. Germany and the US are the company's
largest individual flooring markets, although sales are also conducted in
several other European countries and in China. Witex's main owner is H-W
Industries GmbH & Co KG, a group that also includes Homanit GmbH & Co KG, which
manufactures HDF and MDF board for laminate flooring production.

Funk Chemie

Funk Chemie is a privately owned industrial group active in the chemical and
real estate markets.

Questions can be directed to:

Rolf Rahmberg, Vice President Corporate Communications  + 46 435 381 59
Annette Lldman, Vice President Investor Relations       + 46 435 376 60



END



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