M-real - Company Announcement

M-real divests the Hallein Pulp mill in Austria to Schweighofer Group

Espoo, 2011-06-30 09:00 CEST (GLOBE NEWSWIRE) -- M-real Corporation Stock
Exchange Release on 30 June 2011 at 10:00 EET 

M-real Oyj, part of Metsäliitto, has signed an agreement to divest the entire
share capital in M-real Hallein GmbH to the Schweighofer Group. M-real Hallein
GmbH assets consist of the Hallein pulp mill, bioenergy plant, paper mill
closed in 2009 and the surrounding estate. The pulp mills annual capacity is
approximately 160,000 tonnes of sulphite pulp and the amount of personnel is
approximately 200. The debt-free value of the transaction is approximately EUR
34 million and  the positive cash impact for M-real approximately EUR 24
million. 

The divestment is expected to reduce M-real's annual sales by approximately EUR
75 million and improve the operating result by approximately EUR 5 million
based on Hallein mill's actual performance in 2010. 

“M-real is focusing on cartonboard business and this transaction is a good
example of our work to divest the non-core assets. M-real does not use pulp
from Hallein in its own board or paper operations and the profitability of the
mill as a market pulp supplier has not met our targets. This is a good solution
also for the mill as the new owner is in a better position to develop the
operation further”, says Mikko Helander, CEO of M-real. 

The transaction is subject to the approval of Austrian competition authorities
and it is expected to be closed during 3Q 2011. M-real continues to sell
Hallein pulp volumes to the market during 12-15 months following closing until
the new owner has established their own sales organization and systems. 

As a result of the transaction, M-real will classify Hallein according to IFRS
5 as Asset Held for Sale and recognizes it to its fair value. Market Pulp and
Energy business area's 2Q 2011 operating result is expected to include an
approximately EUR 50 million negative non-recurring item. 

The Schweighofer Group is a family owned, Austrian based holding company with
companies in different branches and countries. The main focus of the group is
forest industry. 


For further information, please contact:
Sari Pajari, SVP, business development tel. +358 10 465 4525