Note: This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy
between this translated document and the Japanese original, the original shall prevail.
January 30, 2023
Dear All,Name of Company

Mitsubishi Paper Mills Limited

Name of representative

Ryuichi Kisaka, President and CEO(Code No. 3864, TSE Prime)

Inquiries:

Koji Kobata,
General Manager of Global Business Management
Department(TEL.03-5600-1481)(Progress of Disclosure) Notice of Business Sale of the Flensburg Mill of the German subsidiary(Spin-off of Business and Share Transfer of the Receiving Company)

On January 30, 2023, the Board of Directors of the company has decided to sell the Flensburg Mill business of its German consolidated
subsidiary, Mitsubishi HiTec Paper Europe GmbH ("MPE"), (the "Business").
Specifically, MPE will, through a spin-off (the “Spin-off”), transfer the Business to a company to be newly prepared by MPE ("NewCo"), andtransfer all of the NewCo's shares to Timber QCP GmbH, an associated company of Quantum Capital Partners GmbH.(Hereafter, thistransaction is referred to as the "Business Sale".)Since the Spin-off is between wholly owned subsidiaries, certain disclosure items and details regarding the Spin-off are omitted.

Notice1. Reason for the Business Sale
As announced in the " Notice of withdrawal from business at the Flensburg Mill " on August 5, 2022, the company has decided to withdraw
from the Business and has been studying various options of the withdrawal. As a result, we have decided the best option is to sell theBusiness to Timber QCP GmbH.

2. Schedule of the Business Sale
Date of resolution at the meeting of Board of Directors
approving the Business Sale

January 30, 2023

Date of conclusion of the Share Purchase Agreement

Early February 2023 (planned)

Date of conclusion of the Spin-off Agreement

Late March 2023 (planned)

Effective date of the Spin-off

First half of the year 2023 (planned)

Date of closing of the Share Purchase Agreement

First half of the year 2023 (planned)

3. Summary of the Spin-off(1) Schedule of the Spin-off
As described in "2. Schedule of the Business Sale" above.

(2) Method of Spin-off
This is a Spin-off with MPE as the transferring company and NewCo as the Receiving Company.

(3) Details of allotment related to the Spin-off
Upon the Spin-off, all shares issued by the NewCo will be issued to MPE. Thereafter, MPE will transfer all the NewCo’s shares to Timber
QCP GmbH.

(4) Handling of stock acquisition rights associated with the Spin-off
Not applicable.

(5) Increase or decrease in share capital due to the Spin-off
There will be no increase or decrease in share capital of MPE due to the Spin-off.

(6) Rights and obligations succeeded by the Receiving Company
NewCo will succeed the assets, liabilities, contractual status and other rights and obligations associated with the Business subject tothe Spin-off as set forth in the Spin-off agreement.

(7) Prospect of fulfillment of obligations
It has been decided that the NewCo has no problem in fulfilling its obligations after the effective date of the Spin-off.

(8) Overview of companies involved in the Spin-off
Transferring Company

Receiving Company① NameMitsubishi HiTec Paper Europe GmbH② Location

Bielefeld, Germany

Germany③ Job Title and name ofTitle: Managing Director

To be determined

representative

Name: Matsuzawa, Shigeji④ Description of business

Manufacture and sale of paper

To be determined⑤ Share Capital

EUR 11,759,000

To be determined⑥ Year of Establishment

1799

To be determined⑦ End of Fiscal year

December 31

To be determined⑧ Major shareholders andMitsubishi Paper Holdingownership ratios ratios(Europe) GmbH100%

Mitsubishi HiTec Paper Europe

100%

GmbH

⑨ Financial position and operating results for the most recent fiscal year (Fiscal year ended Dec, 2021)
Net assets

EUR △6,804,000-

Total assets

EUR 161,506,000-

Net sales

EUR 263,832,000-

Ordinary profit

EUR △18,354,000-

Net income

EUR △20,531,000-*Mitsubishi Paper Holding (Europe) GmbH is a wholly-owned subsidiary of the company.
*The Receiving Company is a company to be newly prepared by MPE, and disclosure of its financial position and operating results for the mostrecent fiscal year is omitted.
*Per share information is not provided for the Transferring Company because the Transferring Company is a limited liability company under thecompany act in Germany.

(9) Overview of the Business to be Spun-Off① Businesses of the division to be Spun-Off
Manufacturing and sale of thermal paper, inkjet paper and barrier coat paper at the Flensburg Mill

② Operating results of the Business to be Spun-Off (fiscal year ended December 2021)
Sales: EUR 60,333,000③ Items and amounts of assets and liabilities to be Spun-OffTotal assets: EUR 37,258,000, Total liabilities: EUR 25,671,000

*The above information is as of December 31, 2021.The actual amount of assets and liabilities to be Spun-Off will be determined after
adjusting the above amount for the increase or decrease up to the effective date of the Spin-off.

④ Situation after the Spin-off
There will be no change to the name, location, title and name of the representative, business, capital, and fiscal year of the company
with the Spin-off. On the execution date of the Share Transfer, all NewCo shares will be transferred to Timber QCP GmbH.

4. Overview of the Share Transfer(1) Schedule for the Share Transfer
As described in "2. Schedule of the Business Sale" above.

(2) Overview of NewCo to be transferred
As described in "3. Summary of the Spin-off - (8) Overview of companies involved in the Spin-off" above.

(3) Outline of the counterparty of the Transfer① NameTimber QCP GmbH② Location

Seidl-Str. 62, 82031 Grünwald, Germany③ Title and name of representative

Steffen Goerig (Managing Director), Tilman-Claudius Richter (Managing Director),
Christian Vonier (Managing Director)④ Description of business

Managing own assets⑤ Share capital

EUR 25,000⑥ Date of establishment

June 9, 2022

⑦ Net assets

EUR 22,800 (December 31, 2022)⑧ Total assets

EUR 23,540 (December 31, 2022)⑨ Major shareholders and ownership ratios

QCP Equity GmbH (100%)⑩ Relationship between the Company andCapital relationship

Not applicable.

Personal relationship

Not applicable.

Business relationship

Not applicable.

Related party relationship

Not applicable.

said company(4) Percentage of shares to be transferred, transfer price and ownership status before and after acquisition① Ownership ratio before transfer (Ratio of voting rights held)

100%(100%)② Ratio of shares to be transferred (Ratio of voting rights held)

100%(100%)③ Ownership ratio after transfer (Ratio of voting rights held)

0%(0%)*We refrain from disclosing the transfer price from perspective of confidentiality with the transferee.

5. Outlook
As a result of the Business Sale, an extraordinary loss of approximately 3.2 billion yen is expected to be recorded as provision of allowance
for loss on business transfer in the third quarter of the fiscal year ending March 31, 2023. The impact of this matter on our consolidated
business performance is currently under scrutiny, including recent business performance trends. If it becomes necessary to revise theearnings forecast announced on November 14, 2022, we will announce it promptly.