Canadian paper manufacturer looks to acquire US paper mills

VANCOUVER (Scrap Monster): Richmond, British Columbia-based Catalyst Paper Corporation plans to expand in the US by entering into Asset Purchase Agreement to buy two US paper mills. The company has announced an agreement with NewPage Corporation, NewPage Wisconsin System Inc. and Rumford Paper Company to purchase Biron paper mill located in Wisconsin and the Rumford pulp and paper mill located in Maine, USA.

The $74 million acquisition is subject to completion of the previously announced merger between New Page and Verso paper Corp. The acquisition enables Catalyst to better serve its new and existing customers by offering diversified range of products. Upon successful completion of the deal, Catalyst’s annual paper and pulp production capacity is expected to jump higher by additional 995,000 tonnes.

The Biron Wisconsin mill which produces lightweight coated and ultra-lightweight coated paper has installed capacity of 355,000 tonnes per annum. The Rumford Maine mill has 510,000 tonnes paper capacity for coated specialty, coated freesheet and coated groundwood paper, and 130,000 tonnes of hardwood and softwood pulp capacity.

Catalyst Paper currently has three facilities in Port Alberni, Powell River and Crofton. The company had temporarily curtailed one of three paper machines at the Powell River mill for three weeks starting October 31^st. This was done to remove market excess of nearly 6,500 tonnes of specialty paper grades. However, the mill outage has impacted the Q3 operating results of the company. Catalyst Paper reported net loss of $22.5 million during the quarter.