26 February 2007 — Helsinki (FIN): UPM has agreed to sell the Walki Wisa Group, a business unit of the company’s converting division.
The group, which produces wrappings and composite materials, is to be bought by funds managed by CapMan, a Finnish private equity investment company, CapMan.
UPM estimates the sale will result in a capital gain of approximately €25 million ($32.9 million) depending on the accounts to be prepared when the deal closes.
In the spring, UPM launched a profitability programme that is said to have improved the company’s competitiveness in the paper industry and laid the foundation for sustainable profitability. The annual cost savings of the programme are estimated to amount to €110 million ($143 million). The sale complies with UPM’s strategy to divest its non-core businesses.
UPM’s 2006 sales exceeded €10 billion and operating profit grew by 30 percent.
The transaction is expected to be concluded during Q2.