Stock Exchange release December 13, 1999 11:00:00 AM CET


Metso Corporation has signed a definitive agreement to sell its forest machinery group Timberjack to Deere & Company for EUR 600 million (FIM 3.6 billion). Timberjack's worldwide operations will be transferred to Deere & Company immediately after receiving the relevant regulatory approvals. The price will be paid in cash.

The divestment of Timberjack is the first major step in the realization of Metso's new strategic direction. According to its strategic intent, Metso will concentrate on business areas serving process industries. The chosen focus areas are the pulp and paper industry, the construction and civil engineering industry as well as the mining industry. Metso's other businesses will either serve its core areas or offer new growth potential.

In accordance with Metso's strategic goals, the resources released through the divestiture of the forest machine group will be concentrated on securing rapid and healthy growth, balancing the corporate structure, developing the Future Care customer service concept and utilizing new business potential. With the Future Care concept, Metso is responding to its customers' increasing needs to develop, maintain and increase the efficiency of their core processes.

"Timberjack Group was an important part of Rauma Corporation which merged with Valmet to form Metso. However, Timberjack is no longer one of our core businesses. We are delighted to have found a new owner for whom Timberjack is such a strong fit", says Heikki Hakala, President and CEO of Metso Corporation.

By joining forces, Timberjack and Deere expect to achieve cost savings in product design, supply management and manufacturing efficiencies while further enhancing Deere's renowned customer support capabilities.

Metso was advised on the sale of Timberjack to Deere & Company by Warburg Dillon Read.

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