UPM and Sappi offer EU remedies to clear £1.18bn Joint Venture

UPM and Sappi have submitted a number of proposed remedies to its graphic Joint Venture deal, in order to assuage concerns from the European Commission that the deal raises competition concerns

Jonathan Pert
November 6, 2026
The deal would see the graphic paper businesses of UPM and Sappi merge into an independent company

UPM and Sappi have formally submitted remedy proposals to the European Commission, as part of an ongoing review of the companies’ planned graphic paper Joint Venture.

Last month, UPM and Sappi received a Letter of Facts from the European Commission, raising serious concerns about the proposed graphic paper Joint Venture that the companies were in the midst of finalising.

The response from the European Commission means that the graphic paper merger between UPM and Sappi is at risk of being blocked by European regulators, with the Commission particularly concerned about reduced competition and price hikes.

The Joint Venture, which was launched in response to demand and cost issues within the paper market, would see UPM Communication Papers and Sappi’s graphic paper business combine with a 50/50 agreement.

The Joint Venture would operate as an independent company, managing its own operations, resources, and decisions within agreed shareholder boundaries.

The businesses are calculated to have a combined enterprise value of €1.42bn (£1.18bn), with UPM Communication Papers estimated to be worth €1.1bn (£0.92bn) and Sappi’s European business worth €320m (£266.95m).

The proposed remedies from UPM and Sappi have been offered to support the ongoing review process, with UPM asserting that they “do not change UPM’s view that the transaction does not raise competition concerns.”

The remedies consist of commitments across a range of areas relating to the future operations of the Joint Venture, including capacity optimisation for the supply of certain paper grades in Europe.

In UPM’s words, the commitments were made “with a view to maintaining a competitive and stable market despite the ongoing decline in demand, while taking into account environmental performance.”

They also include certain commercial safeguards for customers as well as investments in decarbonisation, electrification, and energy efficiency.

UPM insists that the planned Joint Venture would support the “long-term competitiveness, sustainability, and resilience of the European graphic paper industry.”

UPM adds: “The Joint Venture is a rational response to the structural decline of graphic paper markets in Europe and would enable a more orderly adjustment of industry capacity while maintaining reliable customer supply and generating significant efficiencies.”

The paper and materials specialist also highlights recent challenges faced within graphic paper markets in Europe, pointing to evidence of an industry sales decline of 7% year-on-year in Q3 2026  – though the source for this figure was not included in UPM’s statement.

The European Commission will now assess the proposed remedies as part of its ongoing review process, with UPM and Sappi maintaining that it continues to engage constructively with the Commission. The Commission's final decision is expected by year-end of 2026 or shortly thereafter.

UPM Sappi joint venture new EU
UPM also released a renewed offering for its digital printing paper range

UPM Communication Papers has also launched a renewed paper offering for digital printing, designed to make it easier for customers to find the right paper for different digital printing technologies and applications.

The offering brings together woodfree coated, woodfree uncoated, and book papers in sheets and reels, with the range designed to cover inkjet, HP Indigo, and laser printing.

The offering includes dedicated UPM Digi grades as well as selected products from UPM’s wider paper portfolio, with its compatibility for digital printing reportedly evaluated by technical experts.

The offering also includes configurable service options for digital production environments, such as reels supplied either upright or horizontally on pallets.

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