NB 277
March 8, 2005
FREDERICTON (CNB) - Tembec Inc. will not pursue acquisition of the St. Anne-Nackawic pulp mill, Business New Brunswick Minister Peter Mesheau announced today.
Mesheau made the announcement in Fredericton accompanied by Dale Paterson, executive vice-president and COO of AV
Cell, representing Frank Dottori, president and CEO of Tembec Inc.
(Details)
Tembec made the decision after months of due diligence activities, financial modelling and an internal review.
"This is a disappointing outcome for all concerned, but we respect the time and effort Tembec put into this decision," Mesheau said. "The company conducted a thorough review and worked with our officials in an open and diligent manner. It is unfortunate that the timing and some internal challenges prevented Tembec from going forward.
"Both the mill and the timber resource
offer great potential, and the province intends to vigorously pursue other parties
who we believe may be interested in this site and the resource."
Paterson, speaking on behalf of Dottori, said the decision was not an easy one for Tembec.
"While the mill offers interesting potential, this potential must be measured against the known challenges of the market and operating environments, both today and going forward. As attractive as this opportunity was, Tembec also had to make a realistic assessment of what it would take to successfully restart this mill," Paterson said.
"While the mill was shut down in a sound manner and while the combined efforts of the Province of New Brunswick and the mill workers ensured the facility could be brought back up, a full resumption of operations would take time, dedication of human resources and commitment of financial resources. Given other challenges Tembec and its managers are facing relative to certain of their existing operations, and the market conditions for the foreseeable future, this is an opportunity that Tembec just can't pursue at this time."
Tembec's decision followed four months of review and discussion with a range of parties, including the Province of New Brunswick and the Canadian Auto Workers, who represent most of the employees at the mill.
"Nothing in this decision today is as a result of a view that we would not be able to work with either the province or the CAW," Paterson said.
"Tembec operates in a number of jurisdictions, and it must be said that the professionalism and commitment shown by the various government officials with whom we met and negotiated were as good as we have seen anywhere, any time. The manner in which they conducted themselves was beyond reproach at all times."
Paterson said Dottori had asked him to thank the CAW negotiating team and CAW national president Buzz Hargrove in particular for their efforts.
"The agreement that was negotiated in anticipation of a restart took into account the things that mills of this nature need to have in terms of flexibility and workforce efficiency if they are going to have any chance of survival. In many ways, this agreement could serve as a model for our industry."
Officials at Business New Brunswick are reviewing other options for the St. Anne-Nackawic facility and will meet with members of the Nackawic community task force this week.
05/03/08
MEDIA CONTACTS: Sarah Ketcheson, communications, Business New Brunswick, 506-444-4983; John Valley, company contact, 289-259-5699 or 905-844-4314.
05/03/08