Published: 2018-02-20 13:00:00 CET

Kotkamills Group Oyj: ISSUE OF NEW SHARES TO EXISTING SHAREHOLDERS AND DIRECTORS AND NEW SHAREHOLDER LOANS

Kotkamills Group Oyj

STOCK EXCHANGE RELEASE

20 February 2018, at 2:00 p.m.  (CET + 1)

The shareholders of Kotkamills Group Oyj have on 20 February 2018 unanimously resolved to offer by a directed issue a maximum of 450,770 new series A shares (the "New A Shares") of the company for subscription to the holders of series A shares pro rata to their holding of series A shares, a maximum of 20,000 new series B shares (the "New Management Incentive Allocation") for subscription to certain directors of the Kotkamills group and a maximum of 49,230 new series B shares (the "New B Shares", together with the New A Shares and the New Management Incentive Allocation, the "New Shares") of the company for subscription to the holders of series B shares pro rata to their holding of series B shares, taking into account the New Management Incentive Allocation offered for subscription. The subscription period expires on 26 February 2018. The New Shares represent in aggregate approximately 3.82 per cent of the existing shares in the company. In addition, the board of directors was authorised to issue a maximum of 24,376 new series B shares to key employees and directors of the company or its subsidiaries as part of the company's management incentive system in deviation from the shareholders' pre-emptive subscription rights.

The subscription price for each New Share is EUR 2.00 and the aggregate subscription price for the New Shares is EUR 1,040,000. Pursuant to the terms of the share issue of the New A Shares, the holders of series A shares are in connection with their participation in the share issue required to grant shareholder loans to the company up to an aggregate amount of EUR 5 million. The terms of such shareholder loans would in material respects be equivalent to the terms of the existing shareholder loans.

The purpose of the share issue and the utilisation of the shareholder loans is to ensure successful commercial launch of new food service board products and to secure the efficient working capital management of Kotkamills Group's further increasing consumer board products delivery volumes. As a result of the share issue and the utilisation of the new shareholder loans, Kotkamills Group Oyj would obtain financing in the aggregate amount of EUR 6 million assuming subscription of the New Shares in full.

To the extent all New A Shares and New B Shares are not subscribed based on the primary subscription rights, the board of directors is authorised to resolve on the secondary subscription rights of any shares not subscribed.

Kotkamills Group Oyj
Board of Directors

For additional information, please contact:

CFO Petri Hirvonen, tel.+358 40 571 0834, petri.hirvonen@kotkamills.com

DISTRIBUTION:
Nasdaq Helsinki Ltd

Key media
www.kotkamills.com

Kotkamills Group in brief

Kotkamills is a responsible partner that delivers renewable products and performance to its customers' processes via product innovations created from wood, a renewable raw material. One of the key brands of the company is Absorbex®, an innovative laminating paper product for the laminate, plywood and construction industries. Moreover, Kotkamills offers ecological, technically sound and visually attractive wood products for demanding joinery and construction. In summer 2016, Kotkamills started up a new board machine producing AEGLE(TM) Folding Boxboard and ISLA(TM) Food Service Boards, including the capability to add barriers on-machine. All Consumer Board material solutions are fully recyclable and repulpable.

Kotkamills has two production sites in Finland, located in Kotka and Imatra. The majority shareholder of Kotkamills is MB Funds, a Finnish private equity firm.

www.kotkamills.com

Disclaimer

The information contained in this release shall not constitute an offer to sell or the solicitation of an offer to buy securities of Kotkamills Group Oyj in any jurisdiction.