Mondi PLC on Friday announced it will permanently close the Stambolijski paper mill in Bulgaria after a fire had caused extensive damage at the end of September.

The Weybridge, England-based packaging firm said the decision to close the paper mill will affect around 300 employees at the paper mill, with around €100 million of net closure costs expected.

The fire had broken out on September 24.

‘The fire caused extensive damage to the 100,000 tonne per annum brown kraft paper machine and stopped production at the site. Thanks to the swift and professional response on the day, everyone on site remained safe. After evaluating the options for repairing the mill and the ongoing investment required for the mill to remain competitive into the future, Mondi has concluded that closing the mill and serving customers out of its network of other kraft paper mills is the best course of action overall,’ Mondi said.

Mondi shares were broadly flat at 1,244.50 pence each on Friday morning in London and fell 0.8% to R 285.23 each in Johannesburg.

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