NAU: Logistics & financing The company's original intention was to form a Joint Venture for the logistics chain with several partners, including PEAB. The players have pulled out of the intended agreement regarding ownership and capital.
Given Northlands low market value and good transparency the parties have in the company, they prefer to invest capital (approximately $100 million) directly in Northland instead of investing in a capital-intensive logistics company with only one customer. This means that Northland has decided a wholly owned logistics subsidiary, and to bring in new capital to this alone. This, in turn, will result in that a significant player becomes a new partner of Northland, indicative PEAB, but other options are available.
Decisions will be taken by the board early in week 7.
I believe this should be a good solution also for the shareholders. It means that Northland has full control of the logistics chain and can benefit from future cost reductions (i.e. road shortcut, higher tonnage, railway...). Furthermore, a new strong partner makes it possible for an immediate start of the construction of Hannukainen. Northland's internal cash flow is not sufficient for an early start-up of Hannukainen.