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DAILY NEWS Jul 17, 2012 12:56 PM - 0 comments

White Birch to re-open Stadacona, move ahead with asset sale

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2012-07-17

White Birch Paper Company will reopen the Stadacona newsprint mill in Quebec City on August 2. The mill has been closed since December 9, 2011. The announcement comes after several months of joint efforts with the Government of Quebec and the Syndicat canadien des communications, de l'énergie et du papier (SCEP) unionized employees, to obtain a sustainable operating plan, according to White Birch.

“This marks a new beginning for the Stadacona mill. A second chance. Compromises by all parties involved, have resulted in a promising future for Stadacona,” stated Christopher Brant, president of White Birch.

Brant extended his thanks to Minister Sam Hamad and the other members of the Quebec government for the role they played in ensuring the future of the mill. The provincial government has offered a loan of $35 million, conditional on the company investing $47 million to re-start the mill, reduce its production costs, and diversify its product lines.

The new collective bargaining agreements and government support that paved the way for Stadacona to re-open also move the company closer to a court-approved sale. White Birch has been under creditor protection since 2010.

Courts approved the sale of White Birch’s assets in Sept. 2010 to BD White Birch Investments LLC, but certain pre-conditions of the sale were met at the time. Industry Canada’s approval of the sale, granted on July 13, and the new labour agreements with unions at Stadacona and the two other Canadian White Birch mills were pre-conditions of the sale that have now been satisfied. According to Radio-Canada.ca, an agreement on pensions is the only remaining pre-condition to the sale.

White Birch also owns and operates two other mills in Quebec, Papier Masson in Gatineau and F.F. Soucy in Riviere-du-Loup, as well as one mill in the U.S.

A report from the court-appointed Monitor, presented in March 2012, noted that little or no proceeds were expected to be available to creditors once the asset purchase agreement has closed.


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