Economia
The Board of Directors of Lassila & Tikanoja plc has approved a Demerger Plan concerning the separation of Circular Economy Business into a new listed company
Lassila & Tikanoja plc
Stock exchange release
7 August 2025 at 8:05 a.m
The Board of Directors of Lassila & Tikanoja plc (the “ Company ”), having assessed the strategic alternatives for the Company’s Circular Economy and Facility Services businesses, has approved a demerger plan concerning a partial demerger of the Company. According to the demerger plan, the Company will demerge so that all assets, debts and liabilities of the Company relating to the Circular Economy business area or mainly serving the Circular Economy business area of the Company are transferred to a new independent company to be named Lassila & Tikanoja Plc (the “ New Lassila & Tikanoja ”) and to be incorporated in the demerger (the “ Demerger ”). An application is intended to be made to admit the shares of the New Lassila & Tikanoja for trading on the official list of Nasdaq Helsinki Ltd (“ Nasdaq Helsinki ”). In connection with the Demerger, the Company would retain its Facility Services business area, and the Company is intended to be re-named Luotea Plc (“ Luotea ”). After completion of the Demerger, the New Lassila & Tikanoja would initially have the same ownership structure as Luotea, and there would not be any cross-ownership between Luotea and the New Lassila & Tikanoja.
According to the assessment of the Board of Directors of the Company, separating the Circular Economy and Facility Service business areas could increase shareholder value by enabling each business area to more effectively execute its own focused strategies and growth opportunities.
According to the assessment of the Board of Directors of the Company, the Demerger is expected to enhance the performance of the New Lassila & Tikanoja’s and Luotea’s businesses through improved agility, independent decision-making and stronger management focus. As two separate entities, the New Lassila & Tikanoja and Luotea are also positioned to grow faster, both organically and inorganically, thanks to a more efficient capital allocation strategy.
The Board of Directors believes that demerging into two separate companies would increase the attractiveness of the companies and facilitate the valuation of the businesses. Additionally, the separation would clarify management, simplify company structures, increase transparency and clarify responsibilities.
The Demerger would be executed in accordance with the attached demerger plan as a partial demerger, as set out in the Finnish Companies Act (624/2006, as amended) (the “ Finnish Companies Act ”). The shareholders of the Company will receive as demerger consideration one new share of the New Lassila & Tikanoja for each share owned in the Company (the “ Demerger Consideration ”), that is, the Demerger Consideration will be issued to the shareholders of the Company in proportion to their existing shareholding with a ratio of 1:1. No action would be required from the shareholders to receive the Demerger Consideration. The Company’s shareholders will retain their shareholdings in Luotea.
Completion of the Demerger is subject to, among other things, approval by the Company’s EGM and the registration of the completion of the Demerger with the Finnish Trade Register following the creditor hearing process pursuant to the Finnish Companies Act.
The Board of Directors of the Company intends to propose to the shareholders of the Company that the shareholders resolve on the Demerger in the Company’s EGM, which is expected to be held on 4 December 2025. The EGM resolves on the Demerger and other Board proposals based on the demerger plan. The Board of Directors of the Company will separately publish a notice to the EGM at a later stage.
The planned completion date of the Demerger pursuant to the demerger plan is 31 December 2025. Trading in the shares of the New Lassila & Tikanoja on Nasdaq Helsinki is expected to commence on or about 2 January 2026, or as soon as reasonably possible thereafter. The Company presents the Circular Economy business area as discontinued operations in its financial reporting in accordance with the IFRS 5 standard during the last quarter of 2025. The Board of Directors of the Company may, at any point prior to the completion of the Demerger, resolve not to complete the Demerger if it considers that the completion would no longer be in the best interests of the Company and its shareholders due to a change in circumstances that has occurred or arisen after the demerger plan has been signed.
The figures presented below are based on the L&T Group’s segment reporting for the period 1 July 2024 – 30 June 2025. The reconciliation of alternative performance measures are provided in Appendix 2 of this release.
In its preparations for the Demerger, the Company has secured sufficient financing for the demerging businesses, subject to customary conditions. In order to facilitate the Demerger process, the Company also intends to seek certain consents, waivers and term amendments with respect to its EUR 75 million unsecured notes maturing in 2028, that would transfer to the New Lassila & Tikanoja in the Demerger.
As announced by the Company on 27 June 2025, the Company has also agreed on financing arrangements related to an EUR 80 million bridge facility and an uncommitted accordion facility option to back up the outstanding EUR 75 million unsecured notes. The financing arrangements of the New Lassila & Tikanoja would after the Demerger consist mainly of the outstanding EUR 75 million unsecured notes, provided that the noteholders do not exercise their early redemption rights, a EUR 35 million term loan, and a EUR 40 million revolving credit facility. The financing arrangements of Luotea would consist mainly of a EUR 5 million term loan, a EUR 10 million revolving credit facility, and a EUR 100 million commercial paper program.
The EGM resolving on the Demerger, which is expected to be held on 4 December 2025, will elect the members of the Board of Directors of the New Lassila & Tiknaoja for a term commencing upon the completion of the Demerger. In accordance with the recommendation of the nomination board, the intention is that Jukka Leinonen be elected Chairman of the Board of Directors of the New Lassila & Tikanoja, that Sakari Lassila be elected Vice Chairman, and that Tuija Kalpala, Teemu Kangas-Kärki and Anna-Maria Tuominen-Reini be elected as members of the Board of Directors of the New Lassila & Tikanoja. Subject to the completion of the Demerger, the intention is that Jukka Leinonen, Tuija Kalpala, Teemu Kangas-Kärki, Sakari Lassila and Anna-Maria Tuominen-Reini would not continue as members of the Board of Directors of Luotea. The proposals regarding the respective compositions of the Luotea and the New Lassila & Tikanoja Boards will be included in the notice to the EGM.
The Company announced on 9 June 2025 that the Board of Directors of the Company has proposed that Eero Hautaniemi be appointed as President and CEO of the independent the New Lassila & Tikanoja and that Joni Sorsanen be appointed as CFO of the independent New Lassila & Tikanoja, should the Demerger be completed. Eero Hautaniemi and Joni Sorsanen will continue in their current positions with the Company until completion of the contemplated Demerger, in connection with which the appointments relating to the Demerger will take effect.
The EGM resolving on the Demerger will also elect the members of the Board of Directors of Luotea for a term expiring at the end of the next Annual General Meeting of Luotea. In accordance with the recommendation of the nomination board, the intention is to propose that Pasi Tolppanen, Anni Ronkainen and Juuso Maijala be re-elected as members of the Board of Directors of Luotea, and that Johan Mild, Timo Karppinen and Soile Kankaanpää be elected as new members of the Board of Directors of Luotea. Additionally, in accordance with the recommendation of the nomination board, the intention is that Johan Mild be elected Chairman and that Pasi Tolppanen be elected Vice Chairman of the Board of Directors of Luotea. The Company announced on 9 June 2025 that the Board of Directors of the Company has proposed that Antti Niitynpää be appointed President and CEO of Luotea and that Mika Stirkkinen be appointed CFO of Luotea.
Certain major shareholders of the Company, including Evald and Hilda Nissi Foundation, Nordea Investment Management AB (as investment manager on behalf of Nordea Småbolagsfond Norden, Nordea 1 – Nordic Small Cap Fund and Nordea Invest Nordic Small Cap Fund), Juhani Maijala, Heikki Bergholm, Ilmarinen Mutual Pension Insurance Company, Varma Mutual Pension Insurance Company, Mikko Maijala and Elo Mutual Pension Insurance Company, holding in the aggregate approximately 27.59 per cent of the shares and votes in the Company, have, subject to certain customary conditions, irrevocably undertaken to attend the Company’s EGM and vote in favour of the Demerger.
The Company has received a legally binding advance tax ruling from the Finnish Tax Administration, according to which the Demerger will be treated as a tax neutral demerger as defined in Section 52 c of the Finnish Business Income Tax Act (360/1968, as amended).
The demerger and listing prospectus, which is expected to be published by the Company in November 2025 before the EGM resolving on the Demerger, will contain more detailed information on the Demerger and on the New Lassila & Tikanoja.
Subject to the approval of the EGM and the completion of the Demerger, all the Company’s employees belonging to the Circular Economy business area at the time of completion of the Demerger would transfer to the service of the New Lassila & Tikanoja as existing employees.
Danske Bank A/S, Finland Branch acts as the sole financial advisor of the Company in the Demerger. Hannes Snellman Attorneys Ltd acts as the legal advisor to the Company.
The Company will host a conference call and webcast for analysts, investors and media on 7 August 2025 at 10:30 a.m. Finnish time in connection with the publication of the Half-Year Financial Report. The presentation material will be published on the Company’s website.
The English language briefing will be hosted by the Company’s President and CEO Eero Hautaniemi and CFO Joni Sorsanen.
Conference call:
You can access the teleconference by registering on the link below. After the registration you will be provided phone numbers and a conference ID to access the conference
https://palvelu.flik.fi/teleconference/?id=50050267
Webcast:
To access the audio webcast, please go to: https://lassila-tikanoja.events.inderes.com/q2-2025
Additionally, the Company plans to arrange a Capital Markets Day on 26 November 2025. Further details and invitations to the Capital Markets Day will be published at a later stage.
LASSILA & TIKANOJA PLC
Board of Directors
For more information:
Eero Hautaniemi, President and CEO, tel. +358 10 636 2810
Joni Sorsanen, CFO, tel. +358 50 443 3045
Lassila & Tikanoja is a service company that is putting the circular economy into practice. Together with our customers, we keep materials, manufacturing sites and properties in productive use for as long as possible and we enhance the use of raw materials and energy. This is to create more value with the circular economy for our customers, personnel and society in a broader sense. Achieving this also means growth in value for our shareholders. Our objective is to continuously grow our actions’ carbon handprint, our positive effect on the climate. We assume our social responsibility by looking after the work ability of our personnel as well as offering jobs to those who are struggling to find employment, for example. With operations in Finland and Sweden, L&T employs approximately 7,400 people. Net sales in 2024 amounted to EUR 770.7 million. L&T is listed on Nasdaq Helsinki.
Distribution:
Nasdaq Helsinki
Major media
www.lt.fi/en
Appendix 1: The demerger plan and its appendices
Appendix 2: Reconciliation of alternative performance measures
This release does not constitute a notice to convene a general meeting of shareholders nor does it constitute a demerger or listing prospectus. Any decision with respect to the proposed partial demerger of the Company should be made solely on the basis of information to be contained in the actual notice to convene the general meeting of shareholders of the Company, and the demerger and listing prospectus as well as on an independent assessment of the information contained therein. Investors are directed to consult the demerger and listing prospectus for more comprehensive information on New Lassila & Tikanoja, its shares and the proposed demerger.
This release does not constitute an offer of securities for sale or a solicitation of an offer to purchase the securities described in such release in the United States. In particular, any securities referred to in this release have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and may not be offered, sold or delivered, directly or indirectly, in or into the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There will be no public offering of securities in the United States.
The New Lassila & Tikanoja shares have not been and will not be listed on a U.S. securities exchange or quoted on any inter-dealer quotation system in the United States. Neither the Company nor New Lassila & Tikanoja intends to take any action to facilitate a market in the New Lassila & Tikanoja shares in the United States. Consequently, it is unlikely that an active trading market in the United States will develop for the New Lassila & Tikanoja shares.
The New Lassila & Tikanoja shares have not been approved or disapproved by the U.S. Securities and Exchange Commission, any state securities commission or any other regulatory authority in the United States, nor have any of the foregoing authorities passed comment upon, or endorsed the merit of, the partial demerger or the accuracy or the adequacy of this release. Any representation to the contrary is a criminal offence in the United States.
This release is for information purposes only and is not intended to and does not constitute or form part of any offer or invitation to purchase, otherwise acquire, subscribe for, sell, otherwise dispose of or issue, or any solicitation of any offer to sell, otherwise dispose of, issue, purchase, otherwise acquire or subscribe for, any security. This release is not a prospectus, product disclosure statement or other offering document for the purposes of Regulation (EU) 2017/1129 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018 (as amended, the “UK Prospectus Regulation”), and the contemplated distribution of the New Lassila & Tikanoja shares is expected to be carried out in circumstances that do not constitute “an offer to the public” within the meaning of the UK Prospectus Regulation.
This release includes “forward-looking statements” that are based on present plans, estimates, projections and expectations and are not guarantees of future performance. Words such as “intend”, “assess”, “expect”, “may”, “plan”, “believe”, “estimate” and other expressions entailing indications or predictions of future developments or trends, not based on historical facts, constitute forward-looking information. They are based on certain expectations and assumptions, which, even though they seem to be reasonable at present, may turn out to be incorrect. Shareholders should not rely on these forward-looking statements. Numerous factors may cause the actual results of operations or financial condition of the Company or New Lassila & Tikanoja to differ materially from those expressed or implied in the forward-looking statements. Neither the Company, New Lassila & Tikanoja, nor any of their affiliates, advisors or representatives or any other person undertakes any obligation to review, confirm or to release publicly any updates or revisions to any forward-looking statements to reflect events that occur or circumstances that arise after the date of this release other than as required by applicable laws and regulations.
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