UPM-Kymmene to vigorously oppose U.S. Department of Justice's attempt to block its acquisition of MACtac - Company remains committed to transaction and believes in a positive outcome

In connection with the announcement of its first quarter 2003 financial review, UPM-Kymmene today reiterated its surprise that the U.S. Department of Justice has announced its intention to block UPM-Kymmene's acquisition of MACtac, a U.S. based labelstock producer. UPM-Kymmene believes strongly that the acquisition is pro-competition and therefore pro-customer and intends to vigorously defend the acquisition.

UPM-Kymmene's labelstock subsidiary, Raflatac, is a relatively small player in the United States labelstock market. The MACtac acquisition would allow Raflatac to introduce a full line of products in the U.S. and compete more efficiently. Even after the MACtac acquisition, Raflatac would only have a market share in the United States of approximately 15%.

Raflatac's success in the U.S. labelstock market has been built on high quality products, superior customer service and competitive prices. The Department of Justice acknowledged the benefit of having UPM-Kymmene in this market and stated in its complaint that because of "vigorous competition, labelstock customers have enjoyed significantly lower prices and higher product and service quality than they would have otherwise received." The U.S. authorities also appear not to have considered that labelstock prices have decreased steadily in recent years.

The company understands that court proceedings in the civil lawsuit will begin during the first part of June 2003.

Separately, UPM-Kymmene announced its willingness to fully cooperate with the Antitrust Division of the U.S. Department of Justice in its "criminal investigation into possible price fixing and other forms of collusion in the labelstock industry". To date, the company has not received any details of the investigation or any requests for information.

For further information please contact:
Mr Pentti Kallio, President of Raflatac Group, tel. +358 204 15 0015
Mr Olavi Kauppila, Senior Vice President, Investor Relations, UPM-Kymmene,
tel. +358 204 15 0658

UPM-Kymmene Corporation
Corporate Communications
April 23, 2003