On March 29, Nippon Paper Group, Inc. (President: Yoshio Haga) and Yuen Foong Yu Paper Mfg. Co., Ltd.(hereafter, YFY Paper Mfg.), Taiwan's largest paper manufacturer, agreed that Nippon Paper Industries Co., Ltd.(President: Yoshio Haga), the core operating company of the Nippon Paper Group, takes a stake in YFY Cayman Co., Ltd., a YFY group company established in Cayman Islands to control the containerboard business of the group, and signed a subscription agreement as well as a shareholders agreement. Nippon Paper Group, Inc. and YFY Paper Mfg., based on a strategic business alliance between the companies, have discussed the detailed scheme of NPI's involvement in YFY's containerboard business since October, 2008.

This investment enables the Nippon Paper Group to participate in the YFY Group's containerboard business integrated from paperboard production to corrugated box manufacturing in the burgeoning Chinese and other Asian markets. While expecting further business expansion in these areas, especially in China, by capitalizing on the strengths of the two groups, the Nippon Paper Group will focus on the development of expertise in building relationships with customers and of human resource to sustain its overseas business operation.

 

(*) Please see our News Release "Nippon Paper Group, Inc. Invests in the Paperboard Business of Taiwanese Yuen Foong Yu Paper Mfg. Co., Ltd" as of Oct.28, 2008.

 

[Investment Overview]

Investee company     YFY CAYMAN CO., LTD.

                                           • Sales : US$ 550 million (FY2009)

                                           • Capacity: Containerboard 1.12 million tons /year

                                                               Corrugated box 1.4 billionm²/year

Stake in the investeecompany     20.35%

Subscription date     May 2010 (scheduled)