Frequently asked questions about investment options

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What is the schedule for implementing the changes in profit distribution?

The new types of additional share were introduced on 1 January 2022. The first profit distribution decision under the new model took place in the spring of 2022. The first decision on the interest on members’ capital for Metsä1 additional shares was made in the spring of 2023.

Since October 2021, owner-members have been able to submit notices on how many of their A additional shares they would like to convert into Metsä1 additional shares. You do not need to convert all of your A additional shares at the same time if you do not want to. If an owner-member wishes to keep their A additional shares, no action is required from them.

In future, all interest on participation shares and additional shares will be paid to the owner-member’s bank account unless the owner-member states again where they would like the interest on members’ capital to be directed. From the start of 2022, interest on members’ capital will either be paid to a bank account, or they can be reinvested in Metsä1 additional shares.

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A Metsä1 additional share is valid for ten years, and a wood trade will automatically extend its validity by another ten years. Doesn’t this mean that I should only sell wood once every ten years?

No, because every euro received in wood trade income extends the validity of one existing Metsä1 additional share by ten years from the current end of its validity period.

Additionally, every euro received in wood trade income can be used to subscribe for one new Metsä1 additional share. In other words, this is not a reason to postpone wood trade, because wood trade income extends the validity of Metsä1 additional shares starting with the ones expiring first. The date of conversion of the same additional share may be postponed several times, but never in the case of an individual postponement more than 20 years from the end of the calendar year during which the wood trade income serving as the basis for the postponement was received.

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What happens to Equity Bonuses?

Equity Bonuses will remain, but Equity Bonuses earned on 1 January 2022 or later can only be used for Metsä1 additional shares.

If you wish, you can convert your A additional shares into Metsä1 additional shares.

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What happens to participation shares?

An owner-member’s obligation to invest in participation shares according to the Rules of Metsäliitto Cooperative will stay the same. When distributing interest on members’ capital for the different types of shares, the highest profit is intended to be assigned to participation shares and Metsä1 additional shares. However, the Representative Council decides on the interest on members’ capital and other profit distribution annually based on a proposal from the Board of Directors.

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Will profit distribution be changed, and will the amount distributed be the same?

Like before, the Representative Council decides on the interest on members’ capital and other profit distribution annually based on a proposal from the Board of Directors. In accordance with the profit distribution policy, an average of half of Metsäliitto Cooperative’s profit is set to be distributed to the members, like before. There is no intention to change this. However, in the future, part of the profit distribution is planned to be distributed in Metsä1 additional shares based on wood trade.

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Can an owner-member participate in the new profit distribution based on wood trade volumes if they do not convert their A additional shares?

Yes, it is not affected in any way by an owner-member’s choice to keep their A additional shares or convert them into Metsä1 additional shares.

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Am I eligible for profit distribution based on wood trade volumes if I have not paid for my participation shares?

Yes. However, the profit distribution to a member with unpaid participation shares is first directed to the unpaid participation shares.

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How big will the difference in interest be between A additional shares and Metsä1 additional shares? Can you give any kind of estimate?

For the different types of shares, the highest profit is intended to be distributed to the required participation shares and Metsä1 additional shares. The Metsä1 additional share capital incentivising active wood trade is a significant part of profit distribution, and the goal is to pay higher interest on Metsä1 additional shares than on any other types of additional shares.

The profit on Metsä2 additional shares and A additional shares is mainly lower than that of the participation shares and Metsä1 additional shares. Furthermore, the profit on B additional shares is mainly lower than the profit distributed to Metsä2 additional shares and A additional shares.

The Representative Council of Metsäliitto Cooperative decided the interest to be paid on owner-members’ capital: interest of 7.0% on the owner-members’ participation shares (in 2021: 6.0), 6.5% on Metsä1 additional shares, 4.0% (5.0) on A additional shares, and 1.0% (1.0) on B additional shares.

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Can Metsä1 and Metsä2 additional shares be transferred in a generational handover, inheritance or sale? Will these work the same way as before?

Metsäliitto Cooperative’s participation and additional shares can be transferred to another member or someone joining Metsäliitto Cooperative as an owner-member. The principles regarding transfers are the same for the Metsä1 and Metsä2 additional shares as they have been for A and B additional shares.

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Do we need to keep Metsä1 additional shares for at least ten years before they can be terminated?

No. Metsä1 additional shares can be terminated whenever you wish, and their termination period is the same as that of A additional shares, meaning they are paid to you six months after the turn of the year following the termination.

As specified in the Rules of Metsäliitto Cooperative, the Board of Directors has the right to defer payment of the refund should this place the cooperative’s solvency or capital adequacy at risk. Additionally, section 16 of the Rules of Metsäliitto Cooperative is considered, determining the amount of participation shares and additional share refunds, and the rights of terminated shares.

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Why was this change in additional shares made?

The goal was to develop the profit distribution model so that it will reward owner-members who are dedicated to Metsäliitto Cooperative’s operations, in accordance with the owner strategy and mission. At the same time, we are able to ensure better continuity for members’ capital, which enables more efficient use of the capital and better management of capital volumes.

In future, the goal is to provide better rewards for owner-members regularly conducting wood trade. In the new model, a member is eligible for profit distribution just by conducting wood trade with Metsäliitto Cooperative.

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How does Metsäliitto Cooperative use the money invested in Metsä1?

With the more efficient use of members’ capital enabled by the new model, we seek to provide better return on members’ capital, which in turn will generate more profits to distribute to the members.

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Where can I find more information?

Further information is available in the prospectus on Metsäliitto Cooperative and its additional shares (in Finnish). Additionally, you can contact your personal forest specialist.