Promising it will be business as usual and the 1,500 employees affected will remain on the job, Richmond-based Paper Excellence Canada has purchased all of Catalyst Paper’s operations — paper mills in Port Alberni, Crofton and Powell River, a distribution centre in Surrey and headquarters in Richmond.
Details of the deal have not been disclosed.
Paper Excellence Canada chief executive Brian Baarda said his company has been interested in Catalyst “on and off” for the last few years and the acquisition is an ideal fit for a firm that has been steadily expanding its footprint.
The sale comes after the province and Catalyst worked for months to keep mill operations running, including provisions to protect the pensions of workers and retirees at Catalyst’s mills.
B.C. Premier John Horgan noted the sale will help secure 1,500 forest industry jobs. “Keeping these operations open and jobs in place shows what British Columbians can achieve when we come together and put workers, families and communities first,” he said. “This purchase by Paper Excellence Canada is another major vote of confidence in our province and people. More importantly, it will help keep families and communities strong as we continue to revitalize our coastal forest sector.”
In an interview, Baarda said the acquisition falls in line with Paper Excellence’s strategy.
“We are always on the lookout for opportunities to grow our platform, both in B.C., Canada and ultimately in North America — this is part of our growth plan,” he said. “The nice thing about Catalyst’s operation is it integrates well with some of our existing B.C. operations.
“We also like the fact it has access to marine ports and a lot of the existing infrastructure is useful and gives us access to the export markets we are interested in.”
The deal will require the approval of the B.C. Supreme Court and at least two-thirds of Catalyst shareholders in a vote at a special meeting.
Baarda said Paper Excellence Canada, privately held by Asian investors, does not rule out the opportunity of investing to expand markets and take advantage of increased demand.
His optimism was echoed by Unifor, the union that represents much of Catalyst’s workforce.
“Obviously we will have to see how this plays out, but initial reports are they plan on running all of the assets they are purchasing, which is good news for us,” said Unifor spokesman Scott Doherty.
“[Paper Excellence Canada] actually wants to be in the business of making pulp and paper and that’s a good thing.”
Doherty said there is reason for optimism in the industry, as there has been a lot of investment over the last five to seven years, but Paper Excellence Canada has made the most noise. “They certainly have been the biggest player in reinvesting and trying to take advantage of a growing market in Asia,” he said.
Baarda said the intention is to run the acquisitions “as-is for the foreseeable future.”
Paper Excellence has invested heavily in existing assets in B.C., he said — particularly at its mills in Mackenzie and Howe Sound. “We have done our assessment of these [new] operations and will work to understand and see what other opportunities there are.”
Paper Excellence started life in 2008 as a pulp exporter, and has since become a large producer — it manufactures close to two million tonnes of pulp — at three B.C. mills (before the Catalyst transaction), as well as mills in Saskatchewan, Nova Scotia and two in France.
Catalyst Paper manufactures 1.3 million tonnes of pulp and paper products annually.