| PAPER INDUSTRY NEWS - MARCH 2005 |
This page contains pulp and paper industry news for March 2005
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NEWS MARCH 2005
Stora Enso to Acquire UPM's Minority Shareholding in Corenso
Chuetsu Set to Buy Mitsubishi Paper
Mills
Tokyo, Japan, 28 March 2005 -- Chuetsu Pulp & Paper is set to dole out USD 544
million for Mitsubishi Paper Mills Ltd, a company more than twice its size. The
two enterprises anticipate the transaction will lead to a cut in production,
pulp, sales, distribution, and operation costs of JPY 5 billion per year.
Chuetsu will pay 0.555 a share for each share of Mitsubishi Paper, and the two
companies will officially combine operations on October 1st. Chuetsu will issue
180.7 million new shares to finance the purchase.Canfor to Sell Slocan Sawmill to
Springer Creek Forest Products
Vancouver, British Columbia, Canada, 30 March 2005/PRNewswire/ -- Canfor has
entered into an agreement with Springer Creek Forest Products Ltd. for the sale
of its Slocan Sawmill and related tenure for CAD 6.2 million, plus the value of
inventory, which will be determined at closing. The closing is anticipated to
occur in April 2005, subject to customary approvals and filings.
"Canfor is selling the Slocan mill as part of a process to focus our manufacturing assets around certain product lines and fiber baskets," said Jim Shepherd, Canfor's president and CEO. "We are confident that Springer Creek Forest Products Ltd. will be a good fit for this mill, its employees, and the community of Slocan," he said.
Canfor Corporation is a leading Canadian integrated forest products company based in Vancouver. The company has extensive woodlands operations and manufacturing facilities in British Columbia, Alberta, and Quebec. It also operates a lumber remanufacturing plant in Washington State, in the United States. Canfor is a major producer and supplier of lumber, bleached kraft pulp, specialty kraft paper, plywood, and oriented strand board (OSB) for markets around the world.
Carter Holt Harvey and Tenon Delay Business Transfer
Auckland, New Zealand, 31 March 2005 - Carter
Holt Harvey Limited and Tenon Limited (formerly Fletcher Challenge Forests) have
agreed to defer completion of the sale and purchase of Tenon’s Structural
business by one month. The transaction was previously scheduled for completion
31 March 2005. The parties have taken the decision to defer completion to
address certain operational issues and allow for a smooth transition of the
business. Both parties remain confident that the transaction will complete by
the end of April 2005.
Cascades to Sell Wood Wyant Assets
Kingsey Falls, Québec, Canada, 31 March 2005 – Cascades has announced the sale
of the sanitation products distribution and the chemical products manufacturing
assets of its Wood Wyant subsidiary to a subsidiary of Groupe Sani-Marc, located
in Victoriaville, Québec, for about CAD 23.2 million.
Cascades’ decision to withdraw from the sanitation product distribution business
aligns with the company’s strategic goal of focusing operations on its core
sectors namely the manufacturing and the processing of tissue paper and
packaging products. As such, the Wood Wyant inc. assets related to the
manufacturing of tissue paper finished products, located in Pickering, Ontario,
are excluded from the transaction.
Wood Wyant, with about 270 employees and 13 distribution centers, is a major
sanitation product distributor in Canada. Since Wood Wyant inc. is very well
established in the commercial, institutional and industrial sectors, the
purchaser will pursue its distribution operations under that name.
Commenting on the transaction, Suzanne Blanchet, president and chief executive
officer of Cascades Tissue Group stated: "This sale is in line with our
strategic planning, which began in 2004. It will enable our group to focus its
expertise and resources on the growth of our manufacturing and conversion of
tissue paper, while continuing to develop its business with the entire group of
distributors, including Wood Wyant."
Founded in 1964, Cascades produces, transforms and markets packaging products,
tissue paper and fine papers, composed mainly of recycled fibers. Cascades
employs nearly 15,800 men and women who work in some 150 modern and flexible
production units located in North America, in Europe, and in Asia. Cascades’
management philosophy, its more than 40 years of experience in recycling, and
its continued efforts in research and development are strengths that enable the
company to create new products for its clients and thus offer superior
performance to its shareholders. The Cascades shares trade on the Toronto stock
exchange under the ticker symbol CAS.
International Paper to Sell Its Fine
Papers Business to Mohawk
Stamford, Connecticut, USA, 31 March 2005/PRNewswire/ -- International Paper (NYSE:IP)
announced it has signed an agreement to sell its Fine Papers business to Mohawk
Paper Mills Inc., of Cohoes, New York. The company anticipates cash proceeds
from the transaction will total approximately USD 65 million.
The company announced in December 2004, that it had signed a non-binding letter of intent to sell the business to Mohawk as part of its strategy to improve profitability and focus on core businesses. With a definitive sale agreement now in place, the companies expect to close the transaction early in the second quarter of 2005, subject to various closing conditions.
The Fine Papers Business includes the writing, text and cover papers, and artist papers segments. Included in the sale are the Hamilton, Ohio, paper mill, with an annual production capacity of approximately 65,000 tons; the Saybrook, Ohio, converting center; and the Westfield, Massachusetts, artist papers converting operation. The business employs approximately 500 people. The sale will also include the Strathmore(R), Brite Hue(R), Via(R), and Beckett(R) brands.
International Paper (http://www.internationalpaper.com/) is the world's largest paper and forest products company. Businesses include paper, packaging, and forest products. As one of the largest private forest landowners in the world, the company manages its forests under the principles of the Sustainable Forestry Initiative(R) program, a system that ensures the perpetual planting, growing and harvesting of trees while protecting biodiversity, wildlife, plants, soil, water and air quality. Headquartered in the United States, IP has operations in more than 40 countries and sells its products in more than 120 nations.
Aditya Birla Group of India and
Tembec Move to Acquire Nackawic Mill
Temiscaming , Quebec, Canada, 01 April 2005 – The Aditya Birla Group of India
and Tembec have signed a framework agreement with the Province of New Brunswick
to acquire the St. Anne Nackawic pulp mill. The acquisition will be made by a
joint venture between Birla and Tembec in which Birla will be the majority
partner and Tembec the lead operator.
The Aditya Birla Group was represented by Sailendra K. Jain, director of Pulp and Fibre Business and P.M. Bajaj, senior executive of the Aditya Birla Group. Tembec was represented by Frank A. Dottori, president and chief executive officer.
The announcement came after two weeks of intense negotiation between a small team of senior New Brunswick officials and a similar group representing the joint venture. The Provincial team was lead by Rodney Weston, chief of staff for Premier Bernard Lord. Dale Paterson, executive vice president and chief operating officer and S. V. Sharda, vice president and CFO were the senior AV Cell representatives
“We are excited by the potential of not only expanding our position in paper and specialty [grades], including dissolving pulps, but also increasing our presence in the Province of New Brunswick,” said Jain. “Our positive experience in Atholville has been based on a solid partnership with Tembec, a well trained and dedicated team in the mill and a positive and supportive business climate here in New Brunswick. We see the same potential for the Nackawic mill and look forward to working with the Province, the community, and the workforce to create a stable and competitive site.” “Birla is also pleased to be furthering its relationship with Tembec. Our experience with dissolving pulps and as a major player in the global viscose staple fiber market will compliment Tembec’s proven abilities as a progressive and effective operator, particularly relative to situations like we see in this case,” said Jain.
Work would begin soon after closing of the transaction to convert the mill to produce a mix of papers and dissolving and specialty pulps. This accelerated conversion, along with the support and commitment of the Birla organization, were the primary drivers behind the change in position on the Nackawic site by Tembec according to Frank Dottori, president and CEO of Tembec. “The presence and support of the Birla organization as a partner in this facility was absolutely key in this change of position on how Tembec views the restart of the mill. We have had an extremely constructive and positive relationship with Birla at our existing AV Cell partnership in Atholville,” Dottori said.
In addition to the financial support and commitment of Birla, Tembec’s view of the project was favorably influenced by the decision to accelerate the conversion of the mill to specialty and dissolving pulp grades, as well as maintaining its current capability as a producer of hardwood pulp for paper grades.
“This accelerated ability to be able to move the mill away from the vagueries of the hardwood pulp business and into these other grades made it possible for Tembec to take another look at this opportunity. As a mill producing hardwood paper grade pulp, it would be difficult for this mill to attain and maintain a position of cost competitiveness against the large scale, low cost South American producers,” Dottori said.
The framework agreement provides the guidelines for the development of the final agreements and working relationships. It is expected that these details will be worked out in the next several weeks and that site preparation, plant rehabilitation, and training can be completed through the summer and early fall to allow a restart of the mill by October or November. “While there are a number of issues to finalize, we are extremely hopeful that these can be addressed in the next few weeks,” said Jain.
When Tembec’s initial decision not to pursue the St. Anne acquisition was announced on March 8, Dottori had been very complimentary of the manner in which the Provincial officials involved had conducted themselves. He again commented on this, a sentiment echoed by Jain. “Both negotiating teams are to be complimented. As with the previous effort, the Provincial officials with whom we dealt conducted themselves in a manner that should be a model for governments anywhere. They were principled, straightforward, realistic, and tough,” said Dottori. “We would like to thank Premier Lord, in particular, for the role that he played in helping to resolve some key final points. His involvement and the commitment of his representatives was critical to this outcome.”
“As positive and exciting as today’s announcement is, it is important for all parties involved to recognize three things. First, there is much to be done before the mill can get back into production. Second, the mill will need to be converted to produce a more diverse product mix of specialty pulps. This will involve capital investment in plant and equipment and a parallel investment in the training of people. Third, and perhaps most important, it will be critical for this business to achieve excellence in both cost and quality if it is to be able to compete in a world of liberalized trade and intense competition.” said Jain. “All parties here today must be prepared to work together to overcome these challenges,” concluded Jain.
The Aditya Birla Group has a turnover exceeding USD 6 billion (as at March 31, 2004) and is one of the largest business houses in India. It enjoys a leadership position in all the sectors in which it operates including cement, nonferrous metals, carbon-black, and pulp and fiber. The group has 66 manufacturing operations in eight countries around the world, including India, Thailand, Indonesia, Malaysia, the Philippines, Australia, China, Egypt, and Canada. It is reckoned as India's first multinational corporation. The group is anchored by 72,000 employees and has more than 700,000 shareholders. It has an asset base of more than USD 6 billion. Additional information is available at www.adityabirla.com
Tembec is a leading integrated forest products company, well established in North America and France. With sales of approximately $4 billion and some 11,000 employees, it operates 50 market pulp, paper, and wood product manufacturing units, and produces chemicals from by-products of its pulping process. Tembec markets its products worldwide and has sales offices in Canada, the United States, the United Kingdom, Switzerland, China, Korea, Japan, and Chile. The company also manages 40 million acres of forest land in accordance with sustainable development principles and has committed to obtaining Forest Stewardship Council (FSC) certification for all forests under its care by the end of 2005. Tembec’s common shares are listed on the Toronto Stock Exchange under the symbol TBC. Additional information is available at www.tembec.com
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