The advice of Monday Group has announced its decision to sell the group’s Russian assets. According to the group, as of December 31, 2021, the net asset value of the Russian operations was 687 million euros. “Mondi remains deeply concerned about the war in Ukraine and is shocked by the humanitarian impact. We express our deepest sympathy to all those affected by the ongoing hostilities, reiterating our call for an urgent cessation and peaceful resolution” , the company said in the first-quarter report.
The process of disposing of Russian assets is operationally and structurally complex and is being undertaken in an evolving political and regulatory environment. “As a result, there can be no certainty as to when a transaction will close or as to the structure of any transaction,” the company said in the report.
Russian companies have, to date, managed supply chain constraints. However, the situation remains fluid, with disruptions to pulp and paper production possible in the future. All major investment projects in Russia have been suspended.
The company’s main asset in Russia is Mondi Syktyvkar Komi Republic Pulp and Paper Mill. In the Top 50 ranking of the Russian “Lesnaya Industriya Journal”, Mondi Syktyvkar ranked third in terms of revenue among all companies in the forest industry. Mondi Syktyvkar’s revenue in 2020 amounted to 61 billion rubles, and net profit was 11.7 billion rubles. In 2021, Mondi Syktyvkar produced 893,800 tons of pulp, 485,000 tons of paper, 328,700 tons of boxboard and 144,900 tons of newsprint.
Over the past 15 years, the Mondi Group estimates that its investments in Russia have amounted to 1.6 billion euros. Thanks to the investments, the production volume of finished products has increased by 46% compared to the level of 2008. At the beginning of 2022, Mondi announced its intention to invest an additional 300 million euros in Russia over the next 3 years.
Mondi Syktyvkar is a fully integrated factory, from harvesting timber to shipping finished products to the buyer. The mill operates three uncoated thin paper machines, one containerboard machine and one pulp dryer. The company also owns a sawmill, a pulp mill, a power plant and a wastewater treatment plant.
Mondi Syktyvkar employs around 4,500 people.