The sale comprises the Kirkniemi and Kangas mills in Finland, the Stockstadt mill in Germany and the Biberist mill in Switzerland, with total capacity of 1.9 million tons. As part of the transaction, M-real and Sappi have also entered into a long-term agreement on the supply of pulp and BCTMP and other smaller services and supplies.

Of the graphic papers business area’s units, the paper mills in Hallein, Gohrsmühle, Reflex and Äänekoski as well as the Husum mill’s paper machine 8 will remain in M-real’s ownership. The Äänekoski paper mill and the Husum mill’s PM8 will after the closing of the transaction continue production for Sappi under a long-term contract.

Kari Jordan, chairman of the M-real board of directors says the transaction will significantly improve M-real’s future prospects and is the first major step in the European paper industry consolidation in the 21st century.

“The operating environment of the industry will improve, which will be beneficial also for M-real as a future shareholder in Sappi. M-real will now become a more profitable and clearly more focused board and paper company with a strong core in high-quality packaging boards.”

The sale is expected to be completed latest during the first quarter of 2009

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