A step closer to the Neles merger

Sep 27, 2021

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An important milestone was reached on September 22, 2021, when both Valmet’s and Neles’ shareholders approved the merger of the two companies in their respective Extraordinary General Meetings. The approval required the majority of two-thirds of the shareholders´ votes cast and shares represented at the respective EGMs, so both companies have a strong support for the merger from the shareholders´ side.

Due to the prevailing COVID-19 situation, Valmet’s shareholders were advised to vote in advance and follow the meeting online via webcast, or to participate in the meeting by way of proxy representation arranged by the company. Finally, around 99% of the votes were in favor of the merger.

Valmet’s CEO Pasi Laine presented the proposed merger and the combined company to the EGM. Calculated with year 2020 figures, Neles’ flow control business forms 13% of the combined company. Together with services and automation, this lifts the share of stable and recurring business to more than half of Valmet’s net sales, providing resilience to business cycles. There are growth opportunities in all business areas of the new Valmet, both organically and through acquisitions. Neles will provide growth opportunities for Valmet’s automation systems also outside of pulp and paper industry. Revenue, technology development and cost synergy potential all contribute to shareholder value creation.

After the CEO’s presentation, the chairman of the meeting presented the technical implementation of the merger. The shareholders of Neles will get as merger consideration 0.3277 new shares in Valmet for each share they hold in Neles. The proposed resolutions to the EGM formed an entirety that required the adoption of all its individual items by a single resolution. The General Meeting could only approve or reject the proposed resolutions but not amend them.

The merger still requires the approval from the competition authorities. The expected completion date of the merger is on or about January 1, 2022. The planned effective date may change, and the actual date may be earlier or later than the above-mentioned date. Until that time, Valmet and Neles will continue to operate as two separate companies. This means that we shall concentrate on the on-going business and serve our customers as before.

After the completion of the merger, Valmet can offer a unique and even more comprehensive offering for process industries, including board, paper, tissue, pulp and energy technologies, services, automation systems and flow control solutions. We can also offer customer service through an even wider global services network.

So, we are now a step closer to the completion of the merger of Neles to Valmet. The integration planning will now start. Target is to ensure that we will have a well-planned and smooth integration of the two companies and a successful onboarding of the new colleagues from Neles to Valmet.