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AV Group to purchase Terrace Bay Pulp for dissolving pulp


July 5, 2012
By Pulp & Paper Canada

The Terrace Bay Pulp mill in northwestern Ontario will be returning to operation, producing dissolving pulp instead of kraft pulp. Aditya Birla Group, through its Canadian subsidiary AV Group, has agreed to purchase the assets of the idled mill…

The Terrace Bay Pulp mill in northwestern Ontario will be returning to operation, producing dissolving pulp instead of kraft pulp. Aditya Birla Group, through its Canadian subsidiary AV Group, has agreed to purchase the assets of the idled mill for a reported price of $300 million. The Indian company, which already owns two dissolving pulp mills in Canada, plans to invest more than $250 million to convert the Terrace Bay site to dissolving pulp for use in rayon.

“The acquisition of Terrace Bay Mill and its subsequent conversion into a dissolving grade pulp mill is a major strategic move for our business where we are global leaders,” states Kumar Mangalam Birla, chairman of the Aditya Birla Group. “The Terrace Bay Mill upon conversion will provide superior quality pulp for our viscose staple fibre business.”

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The Terrace Bay mill has gone through a series of shutdowns in recent years, in response to the restructuring of its parent company, Buchanan Forest Products. In October of last year, it was shut down after an explosion in a blow tank killed one worker.

The mill is able to produce bleached softwood kraft as well as bleached hardwood kraft. An Ontario government announcement of the purchase notes that the re-start will support 275 mill jobs, 335 woodland jobs and an estimated 1,300 indirect jobs province-wide.

The AV Group operates AV Cell in Atholville, N.B., and AV Nackawic, in Nackawic, N.B.


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