UPM-Kymmene denies it may build mill in Russia

HELSINKI Wed Jan 5, 2011 1:46am EST

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HELSINKI Jan 5 (Reuters) - Finnish forestry group UPM-Kymmene (UPM1V.HE) denied a newspaper report on Wednesday that it was in was looking to build a $2 billion pulp mill in eastern Russia.

Finnish business daily Kauppalehti reported the governor of the Russion region of Irkutsk said last month local authorities and UPM were negotiating the construction of a million-tonne pulp mill, estimated to cost $2 billion, in Ust-Kut.

"We are not aware of such plan. We deny that this would be going on," spokeswoman Sini Paloheimo said.

Last month, UPM-Kymmene said it was buying debt-laden rival Myllykoski, bringing much needed consolidation to a European paper industry struggling with overcapacity and weak demand. [ID:nLDE6BK03E] (Reporting by Terhi Kinnunen; Editing by Dan Lalor)

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