The Forming of Operative and Financial Strategies in Global Corporations
Chapter 7: From Domänverket to Sveaskog: reviving the original core business
Back in 1978 a study had suggested certain minor changes in the relationship between ASSI and Domänverket (e.g. that most forests in ASSI’s cutting areas ought to be transferred from Domänverket to ASSI). ASSI responded by calling attention to its 1977 proposal about a merger between the two organizations. However, nothing of significance materialized until 1984, when ASSI and Domänverket negotiated a new long-term timber agreement. A few years later (1987), the two organizations also agreed that Domanföretagen should take over some of ASSI’s sawmills (Karlsborg [soon closed], Lövholmen and Seskarö). Domänverket was profitable during those years (1984–88) and delivered about SEK 800 million to the state. At that time, the conditions for the Swedish forest-based industry were favourable, and nothing indicated a downturn. Still, the investments were usually made abroad, which was explained by the relatively high cost for timber and wages in Sweden, and by growing uncertainty regarding future energy sourcing. ASSI’s timber deliveries continued to be a problem all through the 1980s.
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