HELSINKI (News release) -- UPM has signed an agreement to sell 100% of the shares of its Austrian subsidiary UPM Kymmene-Austria GmbH to the HEINZEL GROUP, a leading pulp, packaging and paper producer and trader in Central and Eastern Europe.

The transaction comprises the UPM Steyrermühl site with approx. 400 employees, including the newsprint paper machine with an annual capacity of 320,000 tonnes and the Steyrermühl sawmill operations with an annual timber capacity of 370,000 cubic meters. The parties have agreed not to disclose the value of the deal.

Closing of the transaction and end of newsprint production at UPM Steyrermühl are planned for the end of 2023. HEINZEL is planning to take over responsibility for the mill after closing. Until then, all operations continue as is.

UPM and HEINZEL GROUP will now engage in deeper discussions on specific technical and organizational aspects of the site to plan the future of the mill. HEINZEL plans to operate the UPM Steyrermühl site outside of graphic papers as an integrate together with its Laakirchen mill, which is located in the same communicaty. HEINZEL is considering the production of packaging materials to complement their existing product portfolio. The concrete plans for the repurposing of the new integrate will be communicated by HEINZEL as soon as these have been concluded.

"The agreement benefits both UPM and HEINZEL and supports the development of their businesses in line with market needs. This agreement enables UPM to adapt its newsprint paper production to the long-term market development while leveraging the high value of the Steyrermühl site. This will strengthen our market position while improving our financial performance," says Massimo Reynaudo, Executive Vice President of UPM Communication Papers.

"We are very pleased with the agreement. HEINZEL is a solid and successful player in the industry and will provide a long-term future for the Steyrermühl site. We will continue to collaborate closely with HEINZEL to ensure a smooth transition and enable the strategic development of the site as part of an integrate operated by HEINZEL," Reynaudo continues.

UPM will remain committed to the newsprint business as one of the industry's leading producers, continuing newsprint production at its Schongau, Ettringen, Hürth and Jämsänkoski mills. UPM will also remain committed to the Austrian newsprint market, serving customers from its remaining newsprint mills.

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