Displaying items by tag: specialty

Fortress Paper Ltd. a leading producer of security and specialty papers, in a major strategic move today announces the signing of an asset purchase agreement (“APA”) to acquire the assets of a northern bleached hardwood kraft manufacturing facility located in Thurso, Quebec from Fraser Papers Inc. with the intention to convert this operation into a world class, low cost, specialty cellulose (dissolving pulp) operation. Concurrently, Fortress Paper intends to build a biomass-based cogeneration plant at the Thurso Mill which will produce green electricity resulting in material net energy savings.

Upon closing of the acquisition of the Thurso Mill, which will be completed through its wholly-owned subsidiary Fortress Specialty Cellulose Inc, the Corporation intends to incur capital expenditures of approximately $153 million to convert the non-operating NBHK mill into a high quality specialty cellulose mill and to construct a new cogeneration facility. In connection with the proposed capital expenditures, Fortress Paper is pleased to announce that it has pre-arranged specific financing initiatives to fund the conversion and cogeneration projects.

The specialty cellulose mill is planned to have an annual production capacity of more than 200,000 air dried metric tonnes and is expected to be completed in mid-2011. In entering into the specialty cellulose sector, Fortress Specialty will focus on producing dissolving grade cellulose for the textile industry, primarily targeting viscose fibre (rayon) products which have shown strong growth of approximately 10% in China and 7% worldwide over the past five years. Rayon is a technically evolved and versatile fibre with many advantages, particularly in the warmer and higher growth regions of the world.

Fraser Papers Inc., the Canadian Energy and Paperworkers Union of Canada, the Government of New Brunswick, and other stakeholders, have agreed to the broad terms under which Fraser Papers will proceed to close the sale of its specialty papers business to a company sponsored by the secured creditors of Fraser Papers (Newco).

The agreement included proposed changes to the collective agreements at the company's Edmundston pulp and energy complex which will require ratification on or before March 10, 2010.

The company has filed the agreement with the Ontario Superior Court of Justice, and will work with its secured creditors and Newco to close the sale of the specialty papers business before March 31, 2010.

Under the terms of the purchase agreement, the unsecured creditors of Fraser Papers will receive promissory notes and a 49% common equity interest in the new company. Brookfield Asset Management Inc., a secured creditor, has agreed to convert its secured claim against the company into a 51% common equity interest in Newco while the Government of New Brunswick has agreed to convert its $35 million secured loan plus accrued interest into equity in the form of preferred shares of the new company.

Fraser Papers also announced that the Court has granted a further extension of its creditor protection to April 9.

Wisconsin Rapids Water Works and Lighting Commission (WRWWLC) signed an agreement with Consolidated Water Power Company (CWPCo), a subsidiary of NewPage Corporation, to purchase CWPCo utility transmission and distribution assets.

Located in Wisconsin Rapids, CWPCo provides power to retail customers in [central Wisconsin]. CWPCo also owns and operates five hydroelectric projects along 33 miles of the Wisconsin River in DuBay, Stevens Point, Whiting, Biron and Wisconsin Rapids. The agreement with WRWWLC includes the assets necessary to deliver power to CWPCo's retail customers, and does not include the CWPCo hydroelectric facilities.

An application for approval of this sale was jointly filed later the same day with the Public Service Commission of Wisconsin. Time of closing is dependent on regulatory review and Commission approvals. The purchase price for the utility assets will be equal to the net book value of the assets at the time of closing.

About Wisconsin Rapids Water Works and Lighting Commission (WRWWLC)
The Wisconsin Rapids Water Works and Lighting Commission is a municipally owned electric and water utility. WW&LC serves 14,500 electric and 8,500 water meters in a service territory that includes the City of Wisconsin Rapids and all or parts of the towns of Grand Rapids, Seneca, Sigel, Grant and the Village of Biron.

About Consolidated Water Power Company (CWPCo)
A subsidiary of NewPage Corporation, Consolidated Water Power Company (CWPCo) owns and operates five hydroelectric projects along 33 miles of the Wisconsin River in central Wisconsin located in DuBay, Stevens Point, Whiting, Biron and Wisconsin Rapids. These five hydrofacilities house 39 hydrogenerators with a combined installed capacity of 35.2 megawatts (annual electricity use by about 75,000 households) and provide river water stability for recreational purposes and other uses. CWPCo also owns 24 percent of the Wisconsin Valley Improvement Company, which regulates the river upstream of DuBay, and is represented on the board of directors. The private corporation regulates a uniform flow in the Wisconsin River and helps coordinate the operation of hydroelectric plants on the Wisconsin River. This centralized coordination helps generate increased hydroelectricity and improve flood control capabilities.

About NewPage Corporation
Headquartered in Miamisburg, Ohio, NewPage Corporation is the largest coated paper manufacturer in North America, based on production capacity, with $3.1 billion in net sales for the year ended December 31, 2009. The company's product portfolio is the broadest in North America and includes coated freesheet, coated groundwood, supercalendered, newsprint and specialty papers. These papers are used for corporate collateral, commercial printing, magazines, catalogs, books, coupons, inserts, newspapers, packaging applications and direct mail advertising.

NewPage owns paper mills in Kentucky, Maine, Maryland, Michigan, Minnesota, Wisconsin and Nova Scotia, Canada. These mills have a total annual production capacity of approximately 4.4 million tons of paper, including approximately 3.2 million tons of coated paper, approximately 1.0 million tons of uncoated paper and approximately 200,000 tons of specialty paper. To learn more, visit www.NewPageCorp.com

Media Contact:
Shawn Hall
NewPage
937-242-9373

Fraser Papers Inc. ("Fraser Papers" or the "Company") announced today that, following the extended deadline of January 26, 2010, it had received no additional offers to purchase the Company's specialty papers business (the "Business") under the court supervised sale process (the "Bid Process"). As a result, Fraser Papers has terminated the Bid Process and will continue to work diligently to clear the remaining conditions and complete the firm purchase offer sponsored by the Company's secured creditors that was signed on December 22, 2009 (the "Purchase Agreement").

The Bid Process was approved by the Ontario Superior Court on December 10, 2009 and by the U.S. Bankruptcy Court for the District of Delaware on January 5, 2010. Pursuant to the Bid Process, PricewaterhouseCoopers Inc., the court-appointed Monitor, actively marketed the Business contacting 133 potential acquirers and overseeing the due diligence process with a number of interested parties. While a number of parties expressed preliminary interest, none of them submitted letters of intent. PricewaterhouseCoopers Inc. is expected to issue a report next week providing more details on the results of the Bid Process.

Under the terms of the Purchase Agreement, the unsecured creditors of Fraser Papers will receive ten-year promissory notes and a 49% common equity interest in the new company ("Newco"). Brookfield Asset Management Inc., a secured creditor, has agreed to convert its secured claim against the Company into a 51% common equity interest in Newco while the Government of New Brunswick has agreed to convert its $35 million secured loan plus accrued interest into equity in the form of preferred shares of the new company. Newco and the Company are currently negotiating a $50 million revolving credit facility with CIT Business Credit Canada Inc., which will provide Newco with operating liquidity.

Fraser Papers is an integrated specialty paper company that produces a broad range of specialty packaging and printing papers. The Company has operations in New Brunswick, Maine, New Hampshire and Québec. For more information, visit the Fraser Papers web site at www.fraserpapers.com.

Contacts:

Peter Gordon
Chief Executive Officer
(416) 359-8614

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Glen McMillan
Senior Vice President and Chief Financial Officer
(416) 359-8635

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