Chesapeake Corporation (NYSE:CSK) announced today that it has signed a definitive agreement to acquire First Carton Group Ltd. (First Carton), a leading European packaging supplier for the food and drinks markets.

First Carton's 1999 revenues were approximately $120 million.

First Carton produces high-quality cartons at six locations in the United Kingdom and Germany. The acquisition strongly complements Chesapeake's European Packaging business, both in product offerings and geographic coverage. First Carton employs approximately 800 people.

Chesapeake Chairman, President and Chief Executive Officer Thomas H. Johnson said, "This acquisition strengthens our position as a premier packaging supplier in Europe. First Carton enjoys strong customer relationships. We expect to build upon these relationships, and offer an extended range of products and services resulting from the combined group."

The acquisition of First Carton is the eighth in a series of acquisitions made by Chesapeake since the beginning of 1999 to build its European Packaging business. Today, Europe is Chesapeake's single largest market, with pro forma 2000 sales, including the addition of First Carton Group, of approximately $750 million.

Johnson said, "Our European businesses provide many of the world's premium brands with innovative, cost-effective packaging solutions. The proposed First Carton acquisition builds upon this base and further strengthens Chesapeake's position in Europe. We expect the acquisition to be accretive to Chesapeake's earnings in the first year."

The acquisition is subject to routine regulatory approval and is expected to close in October.

Chesapeake Corporation, headquartered in Richmond, Va., is a global leader in specialty packaging and merchandising services. Chesapeake is the largest North American producer of temporary and permanent point-of-purchase displays, the leading European folding carton, leaflet and label supplier, a leader in plastics packaging for niche markets, and a local leader in specific U.S. markets for customized, corrugated packaging. Chesapeake has over 70 locations in North America, Europe, Africa and Asia. Chesapeake's net sales in 1999 were $1.2 billion. Chesapeake's website is http://www.cskcorp.com.

This news release, including comments by Thomas H. Johnson, contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The accuracy of such statements is subject to a number of risks, uncertainties, and assumptions that may cause Chesapeake's actual results to differ materially from those expressed in the forward-looking statements including, but not limited to: competitive products and pricing; production costs, particularly for raw materials such as corrugated box, folding carton and display materials; fluctuations in demand; government policies and regulations affecting the environment; interest rates; currency translation movements; and other risks that are detailed from time to time in reports filed by the Company with the Securities and Exchange Commission.