The company announced last week that it had agreed to sell its Kajaani sawmill to wood processing company Pölkky Oy in Finland, although it declined to reveal details of the financial arrangements. UPM said further information would be disclosed in its Q2 results to be published on 7 August.
All 83 staff at the Kajaani mill will become permanent employees of new owner Pölkky Oy, which will take over sawn timber production at the mill in August.
Further restructures within UPM include the announcement that production will cease at its Aureskoski and Heinola mills by the end of 2012. The closure of the two mills will result in 97 employees losing their jobs, with redundancies taking place until the end of the year.
A UPM spokesperson said: "The profitability of the three sawmills, Kajaani, Aureskoski and Heinola, has been weak for a long time and they have not become permanently profitable despite earlier restructuring measures. High log price and over capacity in the end-product markets have weakened the situation."
UPM senior vice president of timber Anssi Klinga added: "The new sawn timber and further processing operations model will be based on wood sourcing to our mill integrates. We will continue our timber operations according to the new operations model at locations near our pulp and paper mills in Pietarsaari, Pori, Juupajoki, and Lappeenranta.
"As a significant producer in Northern Finland, Pölkky Oy will be a good successor to continue sawn timber production at Kajanni."
Further, UPM’s sales and management staff at its Lahti timber business will relocate to Tampere and other mill locations within Finland. In total, 42 jobs will be lost across due to the relocation.
UPM said it would support those affected by the redundancies with its work-to-work programme aimed at fast re-employment, retraining and relocation, and allow them to re-apply for open vacancies elsewhere in the company.
The latest announcements follow a number of restructures made by UPM since the beginning of the year. Its newly-acquired Myllykoski unit was closed in the run up to the sale of its housing mill, Papierfabrik Albbruck in May.
At the same time, UPM sold its packaging paper machines at its Pietarsaari and Tervasaari to Swedish paper company Billerud. As a result, it is expected that UPM’s packaging division, which produces 300,000 tonnes of paper annually, will close in the second quarter of 2012.
