West Fraser and Mercer Terminated Cariboo Pulp and Paper JV

SEATTLE (Scrap Monster): Vancouver, B.C. - based West Fraser Timber Co. Ltd. and Mercer International Inc. reached an agreement, by which the companies will dissolve their 50/50 joint venture in Cariboo Pulp and Paper. Further to this, West Fraser will continue to be the sole owner and operator of the mill. West Fraser will do business as Cariboo Pulp and Paper Company.

The Quesnel, British Columbia-based Cariboo Pulp and Paper has an estimated annual production capacity of up to 340,000 tonnes of high-quality Northern Bleached Softwood Kraft (NBSK) pulp. It employs approximately 300 people.

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There are no amounts payable by either company in connection with the dissolution of the joint venture. Further to the transaction, Mercer will retain certain finished product inventory. Also, Merver will recognize a non-cash impairment in Q1 this year in connection with the dissolution of the joint venture.

Sean McLaren, President & CEO, West Fraser reiterated that Cariboo Pulp is an important member of the West Fraser family of mills. The recent agreement better positions the company to support the mill and provides ongoing certainty to its talented workforce, McLaren added.

Juan Carlos Bueno, CEO, Mercer stated that the dissolution will help it to redeploy and direct resources to areas that are better aligned with its long-term focus.