Borregaard — Share Issue/Capital Change 2016

Jun 28, 2016

Borregaard: New lignin operation in Florida in final phase of approval

Borregaard: New lignin operation in Florida in final phase of approval

Borregaard and Rayonier Advanced Materials (RYAM) have concluded a market,

technical and engineering analysis regarding a new lignin operation at RYAM's

Fernandina Beach site in Florida to serve the growing demand for natural lignin-

based products. The final review of the investment by the companies' boards of

directors is anticipated during the second half of 2016 upon receipt of final

permits and incentives from government entities. If the companies elect to

proceed, operations are expected to commence approximately 18 months later.

Cost of construction of the lignin plant is expected to be USD 135 million over

two phases of the project. Phase one, which will have a lignin capacity of

100,000 metric tonnes dry substance, is estimated to cost USD 110 million. An

estimated incremental USD 25 million will be required in phase two to increase

the total capacity to 150,000 metric tonnes dry substance. LignoTech Florida

intends to access the debt markets to fund a portion of the capital

requirements.

The new company, LignoTech Florida LLC, is to be owned 55% by Borregaard and

45% by RYAM.

For background information see also the stock exchange notices of 17 December

2015 and 1 June 2015.

Sarpsborg, 28 June 2016

Contact:

Jørn Syvertsen, Director Investor Relations, +47 958 36 335

This information is subject to the disclosure requirements pursuant to Section

5-12 of the Norwegian Securities Trading Act.

[HUG#2023651]