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Village in Finland faces margarine-fed gold rush

There are few visible signs of the good fortune hovering over this little company town by the Baltic Sea. Yet, if the 57-year-old farmer-owned company here, Raisio Group, a maker of french fries, wheat flour and pet food, plays its margarine right, it may turn into one of those Cinderella success stories usually associated with California software companies or, say, the maker of Nutrasweet.

The reason is that Raisio's new margarine, Benecol, contains a plant extract from the pine trees of Finland that medical testing has shown not only blocks but actually lowers levels of cholesterol in the bloodstream. It sounds almost too good to be true: Simply dab some Benecol on morning toast and within months your cholesterol count may be down 10 to 15 percent and the risk of a heart attack may be cut by a third. So far, a study published in the New England Journal of Medicine has supported the claims, and no negative side effects have been reported.

Ever since Raisio began to produce and sell the new margarine late last year, the conservative company managers have been struggling to keep their Nordic cool in the face of a frenzy by investors and the media.

In the past several months, Raisio stock has more than quadrupled to about $68 a share on the Helsinki Stock Exchange. While Benecol is sold only in Finland for now, the demand has been so overwhelming that the company is hurriedly building a factory to raise production to 5.1-million pounds in 1997 from 880,000 this year.

Even though the cost of Benecol is about five times that of ordinary margarine _ about $10 a pound compared with $1.90 _ Helsinki's big Stockmann stores around the country regularly put up signs apologizing to customers for running out of it.

Global food processing giants are courting Raisio's patented invention. Foreign investors, who owned just 9 percent of the stock last year, now own 44 percent. And, some analysts predict confidently that it will become a major international brand by decade's end, even though sales in the rest of Europe and the United States are probably far off.

"It is like an atomic bomb we didn't mean to invent," said Jukka Maki, 61, the company's deputy chief executive. "We were just looking for a better margarine."

Benecol was born in the laboratory of Ingmar Wester, a company scientist who spent eight years developing a method to extract plant substances known as sterols, whose efficacy in reducing the cholesterol content of blood has been recognized for half a century, and to make them soluble in water.

Working closely with researchers at two Finnish universities, Wester, 37, discovered that sitostanol, a sterol found in pine trees, could be mixed with fatty foods without altering their taste.

Wester completed his work in 1991. But Raisio did not act on his discovery until the results of a yearlong study of sitostanol's effect on the cholesterol levels in 1,500 Finns were published in the New England Journal of Medicine in November.

Now, however, the company does not plan to stop with Benecol. Its scientists are already looking into ways of putting sitostanol into everything from chocolate candy, ice cream and energy bars to mayonnaise, cereals and hamburgers.