According to industry analysts, UPM-Kymmene is expected to seek out potential new acquisitions after failing to buy US Champion International. Topping off the list of possible purchases are Sappi and Cartiere Burgo.
UPM-Kymmene's vice president for business analysis Jukka Huuskonen said: "We have a very strong financial position at the moment, with our equity-to-assets ratio approaching 50% and not much debt so naturally, in line with our strategy, it is clear we are not here twiddling our thumbs."
Sappi, which is not officially up for sale, offers a good fit for UPM-Kymmene because of its dominance in the lucrative coated fine paper segment. Around 80% of its output is fine paper with an overall market share of 15% of the world's coated fine paper market.
Burgo offers a different set of benefits. It could be a suitable European acquisition if UPM-Kymmene wanted to add production facilities close to large urban centres where waste paper is a readily available raw material.
Burgo would also be a way for UPM-Kymmene to reinforce its market share in publication papers in Europe and reduce exposure to relatively high-cost Finnish raw materials.
However, if Burgo's owners, including merchant bank Mediobanca, holding company Compart and Banca di Roma, were selling, they would be talking to several buyers which could force up the companys asking price.