UPM to shut down its Chapelle newsprint mill

The forest-based bio-industry company UPM will permanently cease production at its Chapelle newsprint mill in Grand-Couronne of France, said the company in a press release.

According to the release, the process of consultation with employee representatives in this regard was completed on 15 June in line with the French legislation and approved by the French authorities on 15 July.

The closure impacts 228 people. UPM offers support to employees in order to alleviate the effects caused by staff reductions in relation to the closure of the mill.

With the closure of the mill, UPM will reduce a total of 240.000 tonnes of its newsprint paper production capacity.

“After UPM announced its intention to sell the Chapelle mill in September, we started an active sales process and have been in discussions with interested parties since. However, we have not received any binding offers from any potential buyer. Consequently, we decided to close the mill, while, at the same time, working with employee representatives to mitigate the social impact on our employees. We remain committed to selling the mill assets, if we receive a suitable offer,” said Anu Ahola, senior vice president, News & Retail, UPM Communication Papers.

UPM said it recognises that the restructuring charges will be EUR 78 million in total, whereof EUR 61 million will be cash costs. EUR 45 million was booked as items affecting comparability in Q1 2020 and EUR 33 million in Q2 2020. The action will result in annual savings of approximately EUR 30 million