Finnish pulp and paper maker Stora Enso is contemplating to close down its corrugated packaging converting facility in Chennai, India, due to lack of domestic market.
Stora Enso, a firm engaged in renewable solutions in packaging, biomaterials, wood and paper, has been a party to the plant since July 2011 following its purchase of 51% of shares in Inpac International in China.
Stora Enso Inpac caters to the packaging industry by offering fiber-based solutions. Its Chennai plant makes transport and consumer packaging derived from corrugated board. Its products have markets in the state of Tamil Nadu and its capital city Chennai.
The call for closure is contingent upon its talks with local labor union as the unit has 350 employees eligible for compensation and aids as regards training, medical care and facilitation of skills for finding new employment.
Post-shutdown, Stora Enso is expected to post an operating profit during the second quarter at around €8m, thanks to a restructuring provision. However, its sales and operational EBIT is estimated to be immune from such an impact.
Stora Enso, which provides employment to around 27,000 across 35 countries, posted sales worth €10.2bn in 2014.
