Stora Enso says closes Uruguay deal ahead of plan

HELSINKI, Oct 16 (Reuters) - Nordic papermaker Stora Enso (STERV.HE) said on Friday it and Chilean partner Arauco completed a $344 million acquisition of a Uruguayan pulp mill project from Spain's Ence (ENC.MC) ahead of plan.

The deal, which included 136,000 hectares of land, was announced in May and the transaction was expected to be completed by year-end.

Stora Enso and Arauco acquired the assets in a 50/50 joint venture which will have about 250,000 hectares of land, nearly half of which is planted with hardwood and softwood, Stora Enso said.

Chief Executive Jouko Karvinen said in the statement that completing the deal ahead of schedule was a promising start that would give the partners a solid basis to move forward with their plans in Uruguay.

"Cost-competitive plantation-based pulp is an essential part of Stora Enso's strategy and in one step, this transaction has secured the strategic raw material supply for a world class pulp mill in Uruguay that we are planning jointly with Arauco," he said.

But Stora Enso added that the partners have not yet made a decision to invest in a pulp mill in Uruguay.

The Punta Pereira project was conceived as a huge million-tonnes-per-year pulp mill but the billion-euro project stumbled in the financial crisis.

(Reporting by Helsinki Newsroom)