POWR.L Regulatory News (POWR)

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL

THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES IN THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND DOES NOT CONSTITUTE A PROSPECTUS OR PROSPECTUS EQUIVALENT DOCUMENT. COPIES OF THE COMPANY'S PROSPECTUS DATED 20 OCTOBER 2010 ARE AVAILABLE FROM POWERFLUTE'S REGISTERED OFFICE AND WEBSITE: www.powerflute.com

TERMS USED IN THIS ANNOUNCEMENT HAVE THE SAME MEANING AS THOSE DEFINED IN THE COMPANY'S PROSPECTUS.

POWERFLUTE OYJ

("Powerflute" or the "Company")

23 November 2010

FINAL RESULTS FOR POWERFLUTE'S RIGHTS ISSUE

Following the preliminary results announcement released to the market on 18 November 2010, the Company is pleased to announce the final results of its 3 for 4 Rights Issue and Placing to raise combined proceeds of EUR 19.9 million.

A total of 108,613,630 Rights Issue Shares were offered for subscription in accordance with shareholders' pre-emptive subscription rights to raise proceeds of EUR 14.9 million. The Company received valid acceptances in respect of 85,876,296 Rights Issue Shares, representing approximately 79.07% of the total number of Rights Issue Shares offered to Qualifying Shareholders pursuant to the Rights Issue. The Board of Directors of Powerflute has today resolved to issue New Shares in respect of all the valid subscriptions made pursuant to the subscription rights.

The Board of Directors has resolved to issue New Shares in respect of the remaining 22,737,334 Rights Issue Shares not validly taken up in accordance with shareholder' pre-emption rights to underwriters from whom valid subscriptions have been received. In particular, the Board of Directors resolved to issue 8,538,629 Rights Issue Shares not validly taken up in the Rights Issue to subscribers procured by Collins Stewart Europe Limited in accordance with its obligations as Underwriter in respect of the Rights Issue and 14,198,705 New Shares to Bacchantes Limited in accordance with the terms of the Bacchantes Agreement.

The Company also offered 36,386,370 shares through the Placing to raise further proceeds of EUR 5.0 million. The Board of Directors has received valid subscriptions for the full amount of the Placing and has resolved to issue 36,386,370 New Shares to certain institutional shareholders.

All the Shares subscribed for in the Rights Issue and Placing except for the Shares allocated to the underwriters will be registered with the Finnish Trade Register on 23 November 2010, after which the Interim Shares will automatically become New Shares. The Shares allocated to the underwriters will be registered with the Finnish Trade Register on or about 24 November 2010.

The Company has made an application for New Shares to be admitted to trading on AIM and it is expected that trading will commence on or about 24 November 2010. It is further expected that trading will commence in the New Shares on or about 24 November 2010 on First North Finland. It is expected that the New Shares in uncertificated form will be credited to CREST accounts by no later than 11.00 am on 24 November 2010.

Following the registration of Shares with the Finnish Trade Register on 23 November, Powerflute's total number of Shares in issue amount to 267,080,840 and after the registration on 24 November 2010, Powerflute's total number of Shares in issue will amount to 289,818,174, to which an equal number of voting rights are attached.

The total proceeds of the Rights Issue and Placing amount to approximately EUR 19.9 million. Powerlute's share capital of EUR 88,000,000 will remain unchanged as capital raised through the Rights Issue and Placing was entered in full in the reserve for invested non-restricted equity.

Commenting on the Rights Issue and Placing, Powerfute's Chairman Dermot Smurfit said:

"We are very pleased with the high level of support we have received from existing shareholders for the Rights Issue and the strong interest from new shareholders in participation in the Placing, both of which are evidence of shareholders' continuing belief in the future prospects of the Group. The proceeds from the Rights Issue and Placing will strengthen our financial position and enable us to commit to a number of investment projects and development opportunities which the Board believes offer the potential for attractive returns."

23 November 2010

POWERFLUTE

The Board of Directors

www.powerflute.com

For further information, please contact:

General

This Announcement is not for release, publication or distribution in or into Australia, Canada, Japan or the United States or any other jurisdiction in which the same would be unlawful.

This Announcement does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to purchase any securities in Australia, Canada, Japan or the United States or any other jurisdiction in which the same would be unlawful and should not be relied upon in connection with any decision to acquire any securities in the capital of the Company.

This Announcement is for information only and does not constitute an offer or invitation to acquire or dispose of any securities or investment advice in any jurisdiction.

This Announcement is an advertisement and not a prospectus and investors should not subscribe for or purchase shares (or depositary interests representing such shares) in the Company in connection with the proposed Rights Issue or Placing except on the basis of information contained in the Prospectus published by the Company in connection with the proposed Rights Issue and Placing. Copies of the Prospectus are available from the Company's website (www.powerflute.com).

This Announcement has been issued by and is the sole responsibility of the Company. No representation or warranty express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Collins Stewart or by any of its affiliates or agents as to, or in relation to, the accuracy or completeness of this Announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed.

Collins Stewart, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting as nominated adviser, broker and underwriter exclusively for PowerfluteOyj and for no-one else in connection with the Rights Issue and Placing and will not regard any other person (whether or not a recipient of the Prospectus) as a client in relation to the Rights Issue and Placing and will not be responsible to anyone other than PowerfluteOyj for providing the protections afforded to its clients, nor for providing advice in connection with the Rights Issue and Placing or any other matter referred to herein.

About Powerflute

PowerfluteOyj ("the Company" or "Powerflute") is a packaging group with established positions in Nordic semi-chemical fluting and coated woodfree papers.

Through its subsidiary SavonSelluOy, the Group operates a paper mill in Kuopio, Finland which produces a specialised form of semi-chemical fluting made from locally sourced birch. Corrugated boxes manufactured using Nordic semi-chemical fluting demonstrate strength and moisture resistance and are used for transportation of fruit and vegetables, high-value industrial goods such as electrical appliances and automotive components. The Kuopio mill has the capacity to produce up to 300,000 tonnes per annum and is one of three suppliers of Nordic semi-chemical fluting in Europe.

Through its subsidiary Papierfabrik Scheufelen, the Group operates a paper mill in Lenningen, Germany which produces a range of coated woodfree papers from mixed hardwood and softwood pulps. Coated woodfree papers are used in the production of printed promotional material such as brochures, leaflets and other point of sale materials for producers and distributors of premium branded goods. The Lenningen mill has the capacity to produce up to 300,000 tonnes per annum and supplies the majority of its products into the European market.