UPM and Sappi address EC concerns over planned graphic paper joint venture

European Commission concerns and parties' response

UPM and Sappi have received a Letter of Facts from the European Commission stating it continues to have serious concerns about the proposed graphic paper Joint Venture. The parties are analysing the Letter of Facts and preparing a response. UPM disagrees with the Commission's preliminary assessment and will continue to engage with the review process. To address the Commission’s concerns, the parties plan to submit proposals for specific remedies, but not divestments.

Market rationale for the Joint Venture

The companies describe the JV as a response to structurally declining demand: due to digitalisation, demand for graphic paper in Europe has more than halved over the past two decades and is projected to decline further. They say the JV would enable a more orderly adjustment of capacity, help maintain reliable customer supply, generate efficiencies and support long‑term competitiveness, sustainability and resilience of the European graphic paper industry. Without the JV, they warn capacity closures could accelerate, narrowing grade portfolios and increasing dependence on imports.

Regulatory timeline and status

UPM and Sappi announced the planned Joint Venture in 2025 and signed the definitive agreement in May 2026. Most jurisdictions, including China, South Africa and the U.S., have already approved the transaction. The European Commission’s final decision is expected by year‑end or shortly thereafter, and the Joint Venture would become operational upon closing. The review takes place as the Commission updates its merger policy, reflected in draft revised Merger Guidelines published on 30 April 2026.