Sappi and UPM propose combining their European-based graphic paper businesses to create a new Joint Venture company

Sappi and UPM have today announced the signing of a non-binding letter of intent to form a non-listed, independent 50/50 Joint Venture for graphic paper. This Joint Venture will bring together Sappi’s European Graphic Paper business with UPM’s Communication Papers business in Europe, the UK and the US.

Sappi and UPM will sell their respective businesses and assets mentioned below to the newly formed Joint Venture with a combined enterprise value of €1,420 million excluding the value of the expected synergy benefits. At closing the Joint Venture will raise debt to fund the purchase prices payable to Sappi and UPM respectively. The Joint Venture’s dividend policy will be to distribute all excess cash to its shareholders.  

The Sappi business is valued at €320 million which, based on an FY2025 EBITDA of €64 million represents a 5x multiple. Sappi will transfer pension and other liabilities of €53 million and net assets valued at €267 million to the Joint Venture. In return Sappi will receive cash of €139 million and 50% shareholding in the Joint Venture.  

The UPM business is valued at €1,100 million, which represents a 4.6x multiple of the last reported 12 months to September 2025 EBITDA. UPM will transfer pension and other liabilities of €360 million and net assets of €740 million to the Joint Venture. In return UPM will receive cash of €613 million and 50% shareholding in the Joint Venture. 

Sappi will contribute the following assets: Gratkorn Mill (Austria); Ehingen Mill (Germany), Maastricht Mill (The Netherlands), and Kirkniemi Mill (Finland); as well as Sappi Europe’s wood supply Joint Ventures.

UPM will contribute their Communication Papers business assets which are located at the following UPM mills: Augsburg (Germany), Schongau (Germany), Nordland paper lines 1 and 4  (Germany),  Rauma including UPM RaumaCell (Finland), Kymi (Finland), Jämsänkoski paper line 6 (Finland), Caledonian (United Kingdom), and Blandin (United States of America).  

Sappi and UPM propose combining their European-based graphic paper businesses to create a new Joint Venture company | Sappi

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