THUNDER BAY -- Resolute Forest Products says it plans to sell its Thunder Bay pulp and paper mill.
Seth Kursman, the company's vice-president of corporate communications, sustainability and government affairs, called the mill an exceptional asset, adding it was not an easy decision to put it on the market.
"It's a very difficult decision," Kursman said, reached by phone by CKPR Radio. "Thunder Bay has been a cornerstone for Resolute, and even Resolute's growth plan for the future ... Launching a sale process is an extremely hard thing to do. We believe it's necessary, but that does not make it any easier.
"The Thunder Bay mill will attract a great deal of interest from a number of buyers. It has on-site power generation. First and foremost it has an amazing workforce, a really positive business environment, and I'm not just talking about the job site."
Kursman called the mill a fine example of the circular bio-economy in action.
The sale was necessitated by the sale of Resolute Forest Products to Paper Excellence Group, which also acquired Domtar in 2021.
"It's really hard for us to let go of such a great mill. We had plans to invest a lot of money in that in that facility, to make it even better, to make it stronger and enhance its competitiveness for generations to come," Kursman said. "We certainly think the mill is going to attract a lot of investment from interested parties, we hope ones with deep pockets who will be in a position to invest because the opportunity of that facility is just enormous."
Kursman did not indicate if any potential buyers were in place.
Gary Bragnalo, the Northern area director for Unifor, the union representing 300 of the 430 or so employees at the Thunder Bay mill, said he was caught off guard by the sale announcement.
Bragnalo said he and his memberships believed they would be part of the sale, which is expected to be finalized in the coming days. It's opened up unknowns that remain up in the air at this time, he said.
"We're a good asset, but it leaves a bunch of questions in our members' minds. I've talked to some of them. Wood allocations and timber rights? What's going to happen with that. Also, the sawmills are going to stay with Resolute, based out of Quebec, but they're all tied together right now. Everything is so intertwined with the fibre."
Bragnalo said he's taking it on faith a buyer can be found. Buyers are expected to tour the mill in the coming weeks and months, similar to what's happening at Domtar-owned mills in Dryden and Espanola, Ont.
If it can't be sold, he's uncertain what that means for the mill's future. However, he added he doesn't think it's a similar situation to 2008 in the height of the forestry crisis, when no one was looking to buy the facility, then owned by Bowater.
"No. 1, we want to know what's going to happen for Thunder Bay," Bragnalo said. "And for us to be viable in the future. We know timber rights always followed the mill. So what's going to happen with that? If you don't have timber rights, then what do you do? If you don't have access to the fibre, it's not good."
Patrick Loulou, the vice-chair and chief strategy officer at the Paper Excellence Group, said the sale is part of their takeover bid.
"Today's announcement is a clear demonstration of our commitment to timely complete the acquisition of Resolute," Loulou said in a release.
It wasn't an easy decision, added Remi Lalonde, Resolute's president and chief executive officer.
"This is a very hard thing to do, but we believe it is necessary in order to accelerate our strategic combination with the Paper Excellence Group," Lalonde said.
"The mill is an exceptional asset. I am confident that the dedicated and talented team in Thunder Bay will have a prosperous future with any company fortunate enough to have them as part of their organization."
Any sale of the Thunder Bay pulp and paper mill will be contingent upon closing of the announced acquisition of Resolute by Domtar, and to applicable regulatory approvals. The acquisition of Resolute by Domtar continues to be expected in the first half of 2023, following stockholder and regulatory approvals, and satisfaction of other customary closing conditions, the receipt of which remain outstanding.
This is a developing story and will be updated as more information becomes available.
