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UPM to Streamline Plywood Production and Operations in Finland
Helsinki, Finland, 18 May 2009  – UPM has started up a new production line at its Kalso veneer mill in Kouvola, Finland. The new line increases the production efficiency of the mill, which will require approximately 65 fewer employees. However, because of the current market situation, the capacity of the new production line can not be fully used and the mill has to continue operating with reduced production.

UPM will start employee negotiations on personnel reduction and temporary lay-offs with the employees in production and maintenance at the Kalso veneer mill next week. During the negotiations, possibilities for redeployment of the personnel at the company's other mills and retraining will be discussed. The negotiations are estimated to be concluded in July.

The Kalso veneer mill employs about 190 people, of which about 165 work in production and maintenance. The annual production capacity of the mill is approximately 80,000 cubic meters of rotary cut spruce veneers, which are used as reserve side veneers by parquet industry.

In addition, employee negotiations started in March at UPM's Lohja veneer mill have been concluded. As a result of the negotiations, UPM will reduce the mill's personnel by 15 persons and continue the temporary lay-offs of all other personnel. The personnel reductions and temporary lay-offs are needed to adjust production and order-handling resources in response to the weakened market situation and to increase the profitability of the thin veneer business.

The thin veneer business employs about 100 people in Lohja. UPM produces birch and pine veneer at the Lohja mill, mainly for European furniture industry. The annual production capacity is approximately 10,000 cubic meters of veneers.

UPM offers high-quality WISA plywoods and veneers mainly for construction, transport, and furniture industries. The sales of UPM Plywood in 2008 were EUR 530 million and it has about 3700 employees. UPM has seven plywood mills and two veneer mills in Finland, a plywood and a veneer mill in Russia, and a plywood mill in Estonia. Fo more information, visit www.wisa.com

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