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 Latvia: RIGA FORESTS signs contract to sell sawmill Norupe
[April 9, 2024]

On April 4, 2024, SIA ˇ°Riga Forestsˇ± (SIA "R¨©gas meži") signed a contract with SIA ˇ°Siga RMˇ± for the sale of the sawmill Norupe. The sale process has been implemented in compliance with the principles of good governance, in accordance with the decision of the Council of Riga Forests Ltd, the meeting of participants and the local government, as well as in accordance with the instructions of the State Audit and Competition Council regarding prevention of market and distortion of competition.

Under the contract concluded, the municipal company sells the entire sawmill business as a whole without dividing it into parts. The transaction amounts to Euro 6 million (amount excluding VAT). It will be clarified when the transaction is fully completed, according to the actual situation.

The plant is sold without guaranteed raw material supply contracts. This means that the new owner will be able to participate in timber auctions organised by Riga Forests Ltd and acquire the right to purchase the promised log tree, as will any market participant.

The important condition on the part of SIA ˇ°Riga Forestsˇ± was to respect the interests of the employees of the sawmill Norupe both during the sale process and afterwards. As part of this transaction, the buyer of the sawmill will continue working relations with all 35 employees of the sawmill, take into account their length of service, accumulated vacations, as well as observe the obligations of the employer laid down in the collective agreement of Riga Forests Ltd.

ˇ°Siga RM is expanding its operations and will develop a new, modern, technologically advanced plant in place of the existing sawmill in the next few years, providing well-paid jobs for residents of Ogre and its surrounding areas. This will be the place where timber from Latvia will be processed into high-value export products, which we can be proud of and bear Latvia's name in the world. This is an excellent opportunity to use our accumulated knowledge in the production of high value added products, contributing to the development of Latvian wood processing industry, increase of export volumes and even greater contribution to our national economy,ˇ± emphasizes Janis Osis, board Member and development director of SIA ˇ°Siga RMˇ±.

SIA ˇ°Riga Forestsˇ± sawmill Norupe near Ogre was set up 11 years ago. The sawmill, its structures, the pellet shop and timber storage area cover less than ten hectares. Plant facilities are in working order. However, increasing labour productivity requires substantial investments in modernising them as well as raw materials for production.

Riga Forests Ltd is a municipal company founded in 2008. The company has Jugla, Katrina, Riga and moorland forestry and sawmill Norupe.

Source: rigasmezi.lv