UPM-Kymmene Corporation Press Release January 26, 2007 at 12:00 UPM establishes a new company in Finland focusing on forestry work Company's forestry workers to transfer to the payroll of the new UPM subsidiary Silvesta (UPM, Helsinki, 26 January 2007) - UPM establishes a new company in Finland, Silvesta, which will specialize on forestry work. The company focuses on the planning, implementation and marketing of practical forestry work. It will also seek to strongly develop practical forestry work and thus the profitability of forestry. Once the company has started operations, the service range to forestry service customers and city-based forest owners, as well as to company's own purposes will be extended. UPM has agreed with its forestry workers that they will transfer as of 1 May 2007 to the payroll of Silvesta Oy, a subsidiary of UPM with old terms and conditions of employment. A company-specific agreement has been made with the forestry workers that includes significant improvements and flexibility to the operations. The agreement provides possibilities to develop remuneration and working hour arrangements, and to increase the regional mobility of the forestry workers. This allows for increased operative efficiency, and the practices agreed on also improve the forestry workers' employment situation. The negotiations on reorganisation of practical forestry work were launched in autumn 2006. "The present agreement made with the forestry workers is a solid foundation for developing operations," states Administration Director, Forestry and wood sourcing in Finland, Markku Houni. "The negotiations included an open discussion of forestry work from different angles. The agreement with the forestry workers to develop operations is unprejudiced and seeks to improve the overall efficiency of practical forestry work." "We are satisfied with the outcome of the negotiations," state the representatives of UPM's forestry workers, Lasse Vertanen and Heikki Nupponen. "In the autumn negotiation we objected to the company's proposal to transfer the forestry workers against their will to the payroll of small and unstable companies. The newly established company is active in UPM's entire operating area and stands on solid ground." "Through this arrangement, we will achieve our stated initial objectives. UPM's Finnish forestry department focuses on wood procurement and forest services, and the management and sustainable utilisation of forest assets," says Vice President, UPM Forestry and wood sourcing in Finland, Sixten Sunabacka. "We will purchase any forestry services we need from Silvesta and other service providers. UPM owns 920,000 hectares of forestry land in Finland. In addition, the company has approximately 9,000 separate forestry service agreements with private forest owners. "Managing these forests will require an increasing amount of forestry work in the coming years," predicts Sixten Sunabacka. "Therefore, we will engage in closer cooperation with various forestry service companies and procure more services from them." For further information, please contact: Sixten Sunabacka, Vice President, UPM Forestry and wood sourcing in Finland, tel. +358 400 366 148 Markku Houni, Administration Director, UPM Forestry and wood sourcing in Finland, tel. +358 400 251 958 Sakari Lepola, The Wood and Allied Workers' Union, tel. +358 400 425 198 Lasse Vertanen, Employee's Representative, tel. +358 400 381 560 Heikki Nupponen, Employee's Representative, tel. +358 400 588 9386 UPM-Kymmene Corporation Pirkko Harrela Executive Vice President, Corporate Communications DISTRIBUTION Helsinki Exchanges Main media www.upm-kymmene.com