The company says this is necessary and conditional on its announced acquisition by Domtar.
THUNDER BAY — Resolute Forest Products announces its intention to sell its Thunder Bay pulp and paper mill.
Seth Kursman, vice president of corporate communications, sustainability and government affairs for the company, called the plant an exceptional asset, adding that it was not an easy decision to bring it to market. .
“It’s a very difficult decision,” Kursman said, reached by phone by CKPR Radio. “Thunder Bay has been a cornerstone for Resolute, and indeed for Resolute’s growth plan for the future…Starting a sales process is an extremely difficult thing to do. We believe it is necessary, but it does not make things easier.
“The Thunder Bay plant will generate a lot of interest from a number of buyers. It has on-site electricity production. First and foremost, it has an amazing workforce, a really positive business environment, and I’m not just talking about the yard.”
Kursman called the mill a fine example of the circular bio-economy in action.
The sale was necessitated by the sale of Resolute Forest Products to Paper Excellence Group, which also acquired Domtar in 2021.
“It’s really hard for us to drop such a big factory. We intended to invest a lot of money in this facility, to make it even better, to make it stronger and to improve its competitiveness for generations to come. said Kursman. “We certainly think the plant is going to attract a lot of investment from interested parties, we hope those with deep pockets will be able to invest because the opportunity for this facility is just huge.”
Kursman did not say if any potential buyers were in place.
Gary Bragnalo, northern regional director for Unifor, the union that represents 300 of the Thunder Bay plant’s roughly 430 employees, said he was taken aback by news of the sale.
Bragnalo said he and his members believe they will be part of the sale, which is expected to be finalized in the coming days. It opened up unknowns that remain in the air right now, he said.
“We are a good asset, but that leaves a lot of questions in the minds of our members. I spoke to some of them. Timber allocations and stumpage rights? stick with Quebec-based Resolute, but they’re all linked right now. Everything is so intertwined with fiber.
Bragnalo said he believed a buyer could be found. Buyers are expected to visit the plant in the coming weeks and months, similar to what is happening at Domtar-owned plants in Dryden and Espanola, Ontario.
If it can’t be sold, he doesn’t know what that means for the future of the factory. However, he added that he does not believe this is a situation similar to that of 2008, at the height of the forestry crisis, when no one was looking to buy the facility, which was then owned by Bowater.
“No. 1, we want to know what’s going to happen for Thunder Bay,” Bragnalo said. “And for us to be viable in the future. We know that stumpage rights have always followed the factory. So what’s going to happen with that? If you don’t have stumpage rights, then what are you doing? If you don’t have access to fibre, it’s no good.”
Patrick Loulou, vice president and chief strategy officer of Paper Excellence Group, said the sale was part of their takeover bid.
“Today’s announcement is a clear demonstration of our commitment to complete the acquisition of Resolute in a timely manner,” Loulou said in a statement.
It was not an easy decision, added Rémi Lalonde, President and CEO of Resolute.
“It’s a very difficult thing to do, but we believe it’s necessary in order to accelerate our strategic merger with Paper Excellence Group,” said Lalonde.
“The plant is a tremendous asset. I am confident that Thunder Bay’s dedicated and talented team will have a prosperous future with any company lucky enough to have it in their organization.”
Any sale of the Thunder Bay pulp and paper mill will be subject to the closing of the announced acquisition of Resolute by Domtar and applicable regulatory approvals. The acquisition of Resolute by Domtar continues to be expected in the first half of 2023, following shareholder and regulatory approvals, and the satisfaction of other customary closing conditions, the receipt of which remains pending.
This is a developing story and will be updated as more information becomes available.
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