M-real - Company Announcement

Information and consultation process to discontinue Gohrsmühle mill’s unprofitable operations finalised

M-real Corporation Stock Exchange Release 24 February 2012 at 15.15 EET


M-real Corporation, part of Metsä Group, has concluded the information and
consultation process at the Gohrsmühle mill in Germany. In order to eliminate
the severe losses of the mill, M-real started the negotiations with the
workers' representatives concerning the planned discontinuation of the mill's
uncoated fine paper and unprofitable speciality paper production. M-real
released a stock exchange bulletin on 18 October 2011 concerning these plans. 

Following the conclusion of the negotiations, M-real is able to make the final
decisions to discontinue Gohrsmühle mill's uncoated fine paper production and
the production of the unprofitable speciality papers. As a result, M-real's
annual uncoated fine paper capacity reduces by approximately 120,000 tonnes and
speciality paper capacity by 70,000 tonnes. The related personnel reduction of
maximum 260 people will be implemented by the end of the second quarter of
2012. The level of redundancy costs is in line with the cost provisions made in
the last quarter of 2011. 

M-real continues the Chromolux business and is currently investigating
possibilities to start up folding boxboard sheeting operations at the
Gohrsmühle site. 

Actions to establish a business park in Gohrsmühle continue together with the
workers' representatives and the local authorities with the target to create
new jobs at the site. One of the alternatives is to find partners to the site
to utilise the existing paper production and converting equipment as well as
other site infrastructure.  An example of the successful implementation of the
business park concept is the Reflex mill, where M-real was able to divest
business units to different companies saving more than 200 jobs. Divestment of
M-real's last operations at the Reflex mill, the Premium Paper business, was
finalised in mid-February 2012. 

“We have reached a very important step in our work to eliminate losses of our
paper business. Opportunities to establish a business park in Gohrsmühle are
good,” says M-real's CEO Mikko Helander. 


M-REAL CORPORATION

For further information, please contact:
Matti Mörsky, CFO, tel. +358 10 465 4913
Juha Laine, Vice President, Investor Relations and Communications, tel. +358 10
465 4335