Brussels, 29/07/2008 (Agence Europe) - On Monday 28 July 2008, the European Commission cleared the planned creation by Finnish UPM-Kymmene Corporation (UPM) and B.R.I.S.T. Limited of Malta (BRIST), of a new 50-50 joint venture operation, which will produce sawn timber, oriented strand board and pulp in the Vologda region of Russia as of 2010 - 2012, which it will sell on the wholesale market. UPM is a global forest products group with core businesses in printing papers, speciality papers, label materials and wood products and BRIST is a holding company ultimately controlled by a Russian entrepreneur who controls a number of businesses in, among other areas, wood processing.
The activities of the joint venture overlap horizontally with those of UPM and BRIST in the market for wood-based panel board products and with those of UPM only in the markets for sawn timber and pulp but in all cases, the European Commission notes that the combined current and likely future market shares are and will remain well below 15%. There also is a vertical link between UPM's activities in paper business, in particular, the wood-containing magazine paper market and the joint venture's activities in the upstream market for the production of pulp. The Commission concluded that this would not create competition concerns as pulp has a wider application than wood-containing magazine paper and there would therefore remain a sufficiently large customer base for other pulp producers. (A.B. transl fl)