UPM to build new world-class label materials operation in Poland

(UPM, Helsinki, April 24, 2007 at 12.30) – UPM is continuing the strong development of its label business by building a world-class self-adhesive label materials factory in Poland. The value of the investment is EUR 90 million. Construction of the factory will begin in the third quarter of this year, and production is scheduled for start-up in the final quarter of 2008.

The new production and logistics centre will serve the growing eastern European markets and meet increasing demand for filmic label materials European-wide.

"For UPM, this will be the first industrial operation in eastern Central Europe. Label business is one of UPM's core businesses, and a strategic growth area for the company. We have invested strongly in its development in recent years, and its sales and result have developed favourably. Today's announcement is a consistent step in the strategy," says Jussi Pesonen, President and CEO of UPM.

The new factory will feature newest proprietary technology both in coating and finishing. It will supply a wide range of high-quality film and paper labelstock products with water-based acrylic and hot-melt adhesives.

“This will secure us and UPM Raflatac's label printing customers in Europe a solid growth platform for many years to come. Our on-going global strategic development programme, which has necessitated building new, modern production facilities in North America, Asia and now in Europe, will be largely complete. Our aim is to become the leading supplier in Europe, where particularly films and eastern Europe are strong key growth drivers,” says Heikki Pikkarainen, President of UPM's Label Division.

For further information please contact:
Mr Heikki Pikkarainen, President, UPM, Label Division, mobile +358 40 760 5758
Mr Jan-Erik Forsström, Senior Vice President, Europe, UPM Raflatac,
mobile +358 40 502 9412

About UPM
UPM is one of the world’s leading forest products groups. The Group's sales in 2006 were EUR 10 billion (approx. USD 13 billion), and it has about 28,000 employees. UPM's main products include printing papers, label materials and wood products. The company has production plants in 15 countries and its main market areas are Europe and North America. UPM's shares are listed on the Helsinki and New York stock exchanges. www.upm-kymmene.com.

UPM's Label Division, UPM Raflatac, is a world-leading supplier of self-adhesive label materials for a wide variety of needs in product and information labelling. In addition, UPM Raflatac is at the global forefront in the development and high-volume production of HF and UHF radio frequency identification (RFID) tags and inlays. UPM Raflatac has around 2,500 employees and made sales of approximately EUR 1 billion (USD 1.3 billion) in 2006. UPM Raflatac has a global service network consisting of 11 factories on five continents and a broad network of distribution and slitting terminals and sales offices worldwide. Further information is available at www.upmraflatac.com.