(Adds details, background from paragraph 2)
HELSINKI, June 2 Austrian machine builder
Andritz has initiated arbitration proceedings against
a joint venture in Uruguay, owned by Stora Enso and
Arauco, claiming 200 million euros ($273 million), Stora Enso
said on Monday.
The claim stems from building the Montes del Plata pulp
mill. Andritz built major parts of the long-delayed mill for
Celulosa y Energia Punta Pereira (CEPP), a 50-50 joint venture
between Stora Enso and Arauco.
Arauco is an arm of Chilean industrial conglomerate Empresas
CEPP disputes the claims, Stora Enso said in a statement. It
added that CEPP will pursue its own claims against Andritz for
breach of contract.
The long-delayed Montes de Plata plant is seen as a source
of future growth for Stora as a shift to digital devices drives
down demand for European print paper.
Stora has been cutting back paper output in Europe for years
but sees a brighter future for pulp, which is used to
manufacture not only paper but also a broad range of consumer
products such as tissue and packaging board.
The global pulp market is expected to grow steadily, helped
by booming Chinese demand for different paper and paperboard
Latin America is home to many new pulp mills as its
eucalyptus trees grow faster than other hardwood species and can
be harvested just seven years after planting.
Stora Enso said it had made no provisions concerning the
($1 = 0.7328 Euros)
(Reporting by Sakari Suoninen; editing by Jane Baird)