October 28, 2008

Nippon Paper Group, Inc. Invests in the Paperboard Business
of Taiwanese Yuen Foong Yu Paper Mfg. Co., Ltd

Nippon Paper Group, Inc.

Following the memorandum of understanding signed in last November regarding a strategic business alliance between Nippon Paper Group, Inc. (President: Yoshio Haga) and Yuen Foong Yu Paper Mfg. Co., Ltd (hereafter, YFY Paper Mfg.), Taiwan's largest paper manufacturer, we have agreed that Nippon Paper Industries Co., Ltd, the core company of the Group, participates in the paperboard business of YFY Paper Mfg.
The two companies have investigated ways to develop the business tie-up for further strengthening and expanding the business foundation of their paperboard business. Nippon Paper Industries may invest US$30 million, however, details of subscription as well as delegation from Nippon Paper Industries to the business will be finalized through further discussions with YFY Paper Mfg.
YFY Paper Mfg. is expanding its paperboard business from Taiwan into other parts of Asia, building it up from base paper production to the corrugated carton board business. Nippon Paper Group will pursue this alliance in the rapidly expanding Asian market as part of its effort to embody the company image adopted as the Group Vision 2015 of "One of The World's Top Five Pulp and Paper Companies."
Profile of Yuen Foong Yu Paper Mfg. Co., Ltd.
Chairman: Ms. Melody Chiu
Address : 51, Sec.2 Chung Ching South Rd., Taipei
Capital : 15.723 billion Taiwan dollars (approximately 55.1 billion yen)
2007 consolidated sales : 43.628 billion Taiwan dollars (approximately 152.7 billion yen)
Paper/paperboard production capacity : Approximately 1.9 million tons/year