UPM to Sell Its Steyrermühl Newsprint Mill in Austria to Heinzel Group

The transaction includes the UPM Steyrermühl site with approximately 400 employees, including a newsprint paper machine with an annual capacity of 320,000 tonnes.

June 21, 2022 - UPM has signed an agreement to sell 100% of the shares of its Austrian subsidiary UPM Kymmene-Austria GmbH to the Heinzel Group.

The parties have agreed not to disclose the value of the deal.

The transaction includes the UPM Steyrermühl site with approximately 400 employees, including a newsprint paper machine with an annual capacity of 320,000 tonnes and the Steyrermühl sawmill operations with an annual timber capacity of 370,000 cubic meters.

UPM said the closing of the transaction is expected at the end of 2023. Until then, all operations will continue as is.

Heinzel Group said that it will use the time between signing and closing of the transaction to evaluate and, if feasible, plan and prepare a conversion of Steyrermühl's machines to the production of packaging papers. This evaluation will include not only the paper machine that is currently running, but also a second paper machine at the site which was idled by UPM in 2017.

Currently, Heinzel Group produces a range of kraft papers and containerboard at its sites in Pöls (Austria), Laakirchen (Austria) and Raubling (Germany).

"In Steyrermühl, we will be looking at complementing our existing products," said Heinzel Group CEO Sebastian Heinzel. "We see great potential in the fast-growing markets for sustainable packaging papers."

Massimo Reynaudo, Executive Vice President of UPM Communication Papers, said, "The agreement benefits both UPM and Heinzel and supports the development of their businesses in line with market needs. This agreement enables UPM to adapt its newsprint paper production to the long-term market development while leveraging the high value of the Steyrermühl site."

UPM said it will remain committed to the newsprint business, continuing newsprint production at its Schongau, Ettringen, Hürth and Jämsänkoski mills. UPM will also remain committed to the Austrian newsprint market, serving customers from its remaining newsprint mills.

SOURCE: UPM and Heinzel Group