Ruukki Group purchases majority interest in Junnikkala and Pyyn Saha sawmills in Ostrobothnia. Ruukki Group focuses on wood-based industrial business operations. Currently the group operations are located mainly in Finland, but in future the targeted emphasis is principally in Russia. At present Ruukki Group expands its operations in sawmilling business through acquisitions. In addition, opportunities to make structural changes in house building and care services are being investigated with a target of potentially exiting these businesses. Ruukki Group has agreed to acquire a majority interest in Junnikkala group. Junnikkala Oy practises sawmilling business in Kalajoki, Ostrobothnia, and its subsidiary Juneropt Oy specialises in further processing of sawn wood targeted especially for prefabricated housing business. The annual production capacity of the Junnikkala sawmill is at present 130,000 cubic meters of sawn wood. At the same time, Junnikkala Oy has agreed to acquire all shares of Pyyn Saha ja Höyläämö Oy, which operates in Oulainen. The current annual production capacity of Pyyn Saha ja Höyläämö Oy is close to 40,000 cubic meters. The business and investment plans for the newly formatted Junnikkala group are based on increasing the total combined capacity to 300,000 cubic meters during the next two to three years. In addition, further processing will be developed in the planing and painting operations. The Oulainen sawmill will be focusing on sawing smaller logs, whereas Kalajoki sawmill will be concentrating on further processing in addition to sawing operations. The consolidated revenue of the newly formed Junnikkala group is estimated to have totalled nearly EUR 50 million in 2007 and the operating profit to have been positive. As a result of these arrangements, the annual production capacity of Ruukki Group's sawmilling business will increase immediately from approximately 200,000 cubic meters to nearly 400,000 cubic meters, and by 2010 the total capacity is to reach 500,000 cubic meters level. The current Junnikkala shareholders will continue as minority shareholders of Junnikkala Oy. The arrangement will be carried out through a combination of share transactions, directed share issue and share swap, after which Ruukki Group will have a 51 % ownership in Junnikkala group. The total investment of Ruukki Group is at the present stage a total of EUR 9 million of which approximately 40 % is to be used for the company's future investments according to business plans. ”The arrangement will support Ruukki Group's strategy to enhance wood-based industrial operations. Moreover, this transaction will contribute to the target of strengthening wood processing industry in Northern Finland.”, states Matti Vikkula, CEO of Ruukki Group Plc. “To get Ruukki Group's sawmilling business segment involved into Junnikkala group will enable the implementation of the strong growth strategy of Junnikkala and Pyyn sawmills. In the Ruukki's operating model entrepreneurship will stay as a fundamental principle”, says Juha Junnikkala, Managing Director of Junnikkala Oy. The board of directors of Ruukki Group has decided to explore during the first half of this year opportunities to make structural arrangements in the house building business segment (Pohjolan Design-Talo Oy) and in the care services segment (Mikeva Oy) with a target to dispose of those businesses. These investigations will be made in co-operation with external advisors. For additional information, please contact: Matti Vikkula CEO Ruukki Group Plc Tel. +358 45 6700 606 www.ruukkigroup.fi Antti Kivimaa Executive Vice President Ruukki Group Plc Tel. +358 400 501 780 www.ruukkigroup.fi Juha Junnikkala Managing Director Junnikkala Oy Tel. +358 44 558 1629 www.junnikkala.com