"The planned closures are very unfortunate for the affected employees but restructuring is the only way to make a fundamental improvement in the cost competitiveness of our paper business," Jyrki Ovaska, the president of the UPM Paper Business Group, said in a statement.

The company slated a mill in Kouvola, Finland, and a mill in Albbruck, Germany for closure by the end of the year.

In addition, the company will be reducing capacity in a mill in Ettringen, Germany, and seeking to sell off its Stracel paper mill near Strasbourg, France, in the next 12 months.

UPM said the cuts and closures would reduce magazine paper capacity in Finland, Germany and France by 1.2 million tonnes.

"With the planned actions we would respond to the magazine paper overcapacity challenge ... (and) ensure the efficient use of our remaining capacity," said UPM chief executive Jussi Pesonen, adding however that these moves alone "would not solve" the overcapacity and pricing problems facing the industry.

UPM posted stellar results this year, doubling first-quarter profits and beating second-quarter expectations with a 75 percent increase net profit, earning 295 million euros (418 million dollars) despite the industry's capacity and pricing difficulties.