Valmet has announced the launch of a strategic review to assess the potential separation of its two core business segments into two independent publicly listed companies. The review will evaluate whether operating as separate companies would create greater long-term value for shareholders than the current group structure. If implemented, the separation would result in two companies listed on Nasdaq Helsinki: Biomaterial Solutions and Services and Process Performance Solutions.
Both business segments have developed into large, profitable and largely independent operations with strong market positions and sufficient scale to operate as standalone companies.
The review follows the recent completion of the Severn acquisition, which has increased the annual net sales of the Process Performance Solutions segment to approximately EUR 1.7 billion. The Board believes the current structure provides an appropriate opportunity to assess whether each business could achieve faster growth and greater value creation independently.
Different customer industries and capital requirements
Valmet noted that the two businesses serve different industrial sectors and operate under distinct business models.
The Biomaterial Solutions and Services segment focuses on technologies and lifecycle services for the pulp, paper, board, tissue and energy industries. Its competitive strengths include an extensive installed equipment base, proprietary technologies, global service capabilities and long-standing customer relationships.
The Process Performance Solutions segment provides automation and flow control technologies for a diversified range of industrial sectors. Over the past decade, the business has significantly expanded beyond the pulp and paper industry, with nearly 70% of its revenue now generated from other industrial markets.
Potential benefits under evaluation
The strategic review will assess whether separating the businesses could provide several advantages, including:
- stronger management focus on each business;
- greater operational agility;
- capital allocation strategies tailored to each company’s needs;
- improved access to external financing for future investments and acquisitions;
- increased transparency for investors;
- simpler corporate governance.
The Board will also evaluate whether the capital markets would assign higher valuations to two focused businesses than to the current integrated group.
No decision has been made
“The Board continuously evaluates how to create the greatest long-term value for Valmet’s shareholders. Today, Valmet consists of two strong businesses with distinct markets, growth opportunities and capital allocation needs. Through this review, we will assess whether they can create more value as independent companies than they can together,” said Pekka Vauramo, Chairman of the Board.
Thomas Hinnerskov, President and CEO of Valmet, emphasized that the review will not affect the company’s commitment to customers or its current strategy. “Both of our businesses are well positioned, with strong customer relationships and market positions, as well as talented employees. The review reflects the strength and maturity of both businesses, which we have built through strong execution, organic growth and strategic investments.” He added that maintaining customer service and preserving the benefits of Valmet’s integrated technology, automation and service offering remain key priorities throughout the review process.
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