Fortum - Company Announcement

CORRECTION: Corrected key figures, Fortum sells its electricity distribution business in Finland to Suomi Power Networks

Espoo, Finland, 2013-12-12 07:40 CET (GLOBE NEWSWIRE) -- FORTUM CORPORATION
STOCK EXCHANGE RELEASE, 12 December 2013 at 08.40 EET 

The key figures table has been corrected below.

Fortum has agreed to sell its electricity distribution business in Finland to
Suomi Power Networks Oy, which is owned by a consortium of Finnish pension
funds Keva (12.5%) and LocalTapiola Pension (7.5%) together with international
infrastructure investors First State Investments (40%) and Borealis
Infrastructure (40%). 

The total consideration is EUR 2.55 billion on a debt- and cash-free basis.
Fortum expects to complete the divestment 
process during the first quarter of 2014 subject to the necessary regulatory
approvals as well as customary closing conditions. Fortum expects to book a
one-time sales gain of EUR 1.8-1.9 billion corresponding to approximately EUR
2.0 per share in its Electricity Distribution and Sales Division's first
quarter 2014 results. A total of 320 employees will transfer with the business
at closing with existing terms of employment. 

Fortum's decision to divest its electricity distribution business has no effect
as such on its approximately 640,000 distribution customers. Upon closing, the
customers will transfer with the business with existing terms. 

The decision to divest Fortum's electricity distribution business in Finland is
linked to the strategic assessment of the company's electricity distribution
business' future alternatives. Fortum has published a stock exchange release on
the completion of the assessment today, 12 December 2013. Fortum also prepares
for a possible sale of the Swedish and Norwegian electricity distribution
businesses. The decision to complete the process is dependent on market
development and development of national regulation in both countries, among
others. 

Fortum's electricity distribution business in Finland includes two jointly
managed grid companies: Fortum Espoo 
Distribution Oy, with grids in the city of Espoo and surrounding communities
and the city of Joensuu, as well as Fortum 
Sähkönsiirto Oy, with several grid areas located mainly in southern and western
Finland, but also in the north-western part 
of the country. The combined network length of the companies is 79,000
kilometres delivering approximately 12.6 terawatt- 
hours of electricity to customers. Fortum's market share of the local
electricity distribution in Finland is approximately 
20%.

Fortum's Finnish distribution companies' key figures are:

EUR million                  2012  LTM*
---------------------------------------
Sales                         321   325
---------------------------------------
Comparable operating profit   101    94
---------------------------------------
Comparable EBITDA             154   154
---------------------------------------
Net assets (at period-end)    726   749
---------------------------------------
Gross investments             157   142
---------------------------------------

*The last 12 months ending at the end of the third quarter 2013."Our electricity distribution business is in very good shape and deserves to be
developed further as a core business from 
its own standpoint. We are pleased to have found a buyer, who has a deep
understanding of the social importance of 
infrastructure assets and is committed to develop reliable networks and
services for the customers. This transaction also 
clearly shows that Finland is an attractive country for investors with a
long-term perspective," says Fortum's President 
and CEO Tapio Kuula."We at Fortum can create the best value for our customers, shareholders and the
society as a whole in our competed 
businesses. Our ambition is to grow in accordance with our strategy in
low-carbon power generation, energy-efficient 
combined heat and power (CHP) production and sales as well as in innovative
customer offerings," Tapio Kuula summarises. 

The consortium team members have more than 40 years combined experience in the
acquisition and management of electricity 
networks. Through their extensive experience, all members share a deep
understanding of the social importance of 
infrastructure assets and are committed to good cooperation with the
stakeholders of their investment targets. 


Fortum Corporation
Helena Aatinen
Senior Vice President, Corporate Communications

Distribution:
NASDAQ OMX Helsinki
Media
www.fortum.com

Further information:
Tapio Kuula, President and CEO, tel. +358 10 45 24112
Corporate Communications: Helena Aatinen, Senior Vice President, +358 10 45
20480, 
Fortum Media Desk +358 40 1982 843
Investor Relations: Sophie Jolly, Vice President, tel. +358 10 45 32552

A press conference (in Finnish) will be held today, 12 December 2013 at 11.00
EET in the auditorium of Fortum's head 
office, Keilaniementie 1, Espoo, Finland. The press conference will be
webcasted on Fortum's Finnish website 
(www.fortum.com/fi).

An international teleconference conducted in English for analysts and investors
will be held today, 12 December 2013 at 
14.30 EET. The dial-in numbers:
European callers: +44 (0)20 3427 0503
US callers: + 1 212 444 0481
Finnish callers: +358 (0)9 2310 1621
Confirmation code:  3501655

There will be a replay facility available for one week after the teleconference:
European callers: +44 (0)20 3427 0589
US callers: + 1 347 366 9565
Finnish callers: +358 (0)9 2310 1650
Confirmation code:  3501655

A live audio webcast of the call will be available together with the slide
presentation on Fortum's website at 
www.fortum.com/investors.

Further information on Suomi Power Networks' owners:
Keva is responsible for funding the earnings-related pension cover of municipal
sector employees in Finland serving 1.3 
million insured persons and pension recipients. Keva´s contribution income in
2012 amounted to approximately €4.8bn and 
Keva paid out approximately €3.8bn in municipal sector pensions in 2012. Keva
is a long-term investor where investments are 
targeted to support a stable level of pension contributions. On 31 December
2012, Keva's investments' market value was 
€34.4bn. www.keva.fi

LocalTapiola Pension is the third largest provider of earnings-related pension
insurance in Finland with the number of 
insured approximately 260,000. LocalTapiola Pension's investment assets
amounted to €9.9bn as of 31 December 2012. 
LocalTapiola Pension and Pension Fennia have decided to merge and the merger
will come into effect on 1 January 2014. The 
new business name of the merged companies is Elo Mutual Pension Insurance
Company, and it will have close to €20bn of 
investment assets. www.lahitapiola.fi/elake

First State Investments is the consolidated asset management division of
Commonwealth Bank of Australia, the largest 
financial institution in Australia and currently manages approximately €124
billion of investments globally. First State is 
a leading manager of, and investor in, infrastructure assets. With nineteen
years' experience in infrastructure investment, 
it is one of the longest established managers of infrastructure assets on
behalf of institutional investors and currently 
manages in excess of €2.4 billion of equity invested across assets in the
utility, transport and social infrastructure 
sectors in Australasia and Europe. www.firststateinvestments.com

Borealis Infrastructure Management Inc. Borealis has 15 years of experience
originating, structuring and actively managing 
infrastructure investments on behalf of the Ontario Municipal Employees
Retirement System (“OMERS”). OMERS, which was 
established in 1962, is a large defined benefit Canadian pension plan with 
429,000 members, net assets of more than CAD 
$60bn and an AAA credit rating from Standard & Poor's. OMERS was one of the
first large Canadian pension plans to invest in 
private markets, including infrastructure and has earmarked more than 20% of
its portfolio to be allocated to 
infrastructure investments. Borealis has sourced and currently manages over 20
infrastructure investments in Canada, the 
United States and Europe, representing over C$10 billion of OMERS' invested
equity. www.borealis.ca 

Further information on Fortum:

Fortum's purpose is to create energy that improves life for present and future
generations. We provide sustainable 
solutions that fulfill the needs for low emissions, resource efficiency and
energy security, and deliver excellent value to 
our shareholders.

Fortum is the leading electricity distribution company in the Nordic countries
with over 1.6 million network customers: 
~903,000 in Sweden;  640,000 in Finland and ~102,000 in Norway. Electricity
distribution is a nationally regulated 
business. At Fortum, the Distribution business area is part of the company's
Electricity Solutions and Distribution 
Division that is also responsible for retail sales of electricity.

Fortum is the second largest electricity retail company in the Nordic countries
with approximately 1.2 million customers in 
Finland, Sweden and Norway. Electricity sales is a competed business and there
are altogether 350 electricity retailers in 
the Nordic countries.

Fortum's largest division, Power, consists of Fortum's power generation, power
trading and power capacity development as 
well as expert services for power producers. Fortum's Heat Division consists of
combined heat and power (CHP) generation, 
district heating activities and business-to-business heating solutions in the
Nordic countries and other parts of the 
Baltic Rim. The Russia Division consists of power and heat generation and sales
in Russia. 
In 2012, Fortum's sales totaled EUR 6.2 billion and comparable operating profit
was EUR 1.7 billion. We employ 
approximately 10,400 people. Fortum's shares are quoted on NASDAQ OMX Helsinki.
Further information: www.fortum.com