Bid for Fort Frances Paper Mill Rejected by Resolute

SEATTLE (Scrap Monster): Resolute Forest Products (RFP) has rejected a bid offer from the private investment group Repap Resources expressing interest to purchase the shuttered Fort Frances, Ontario pulp and paper mill. In a letter addressed to Mayor June Caul, the company president Yves Laflamme stated that Repap’s bid fell short on multiple fronts.

Earlier in January this year, RFP had signed a backstop agreement to handover the site to a community redeveloper. Parallel to it, it had also welcomed interested parties to prepare offers to purchase the assets by March 15^th, 2019. Although several entities expressed their interest, only Repap submitted bid.

RFP noted that Repap’s offer failed in providing the company with a level of certainty required to moving forward with them. Also, Repap failed to provide the required financial deposit. In addition, it also didn’t mark up the asset purchase agreement or address the environmental remediation requirement. Further, it refused to an agreement which requires them to treat Resolute’s information on a confidential basis.

The letter further states that a return to manufacturing operations is most unlikely and that it is currently focused on community development project proposals which in turn would reposition the Fort Frances mill site. A public announcement to this effect is expected in the next several weeks, it said.

The Fort Frances mill was idled in 2014, following a series of operational changes and employee lay-offs.