Paper

Nine Dragons to acquire US Catalyst Paper mills

© Moreno Soppelsa | AdobeStock

Hong Kong-based Nine Dragons Paper Ltd. has signed an agreement to acquire assets from Richmond, British Columbia-based Catalyst Paper in a transaction being valued at $175 million.

The sale includes Catalyst’s paper mills in Rumford, Maine, and Biron, Wisconsin, along with associated staff at Catalyst’s facility in Dayton, Ohio.

“This transaction allows Catalyst to repay a significant portion of our debt and focus on our British Columbia operations,” says President and CEO Ned Dwyer.

Catalyst has three mills in British Columbia that employ some 1,300 people.

Under terms of the agreement, Catalyst will provide transition support services to Nine Dragons to help develop certain operational and administrative functions required for the two paper mills.

The Rumford mill operates three paper production lines that have a combined annual production capacity of approximately 550,000 metric tons. The mill can produce coated one-side, coated freesheet and coated groundwood grades.

With two kraft pulping lines and a dryer, the mill has a combined annual pulping capacity of roughly 520,000 metric tons for kraft pulp (hardwood and softwood grades), of which about 400,000 metric tons are used for internal consumption, with the remainder being sold on the open market.

The Biron mill operates two paper production lines with a combined annual production capacity of nearly 340,000 metric tons, primarily in coated groundwood grades.

Nine Dragons indicates it intends to invest in growing both mills’ capacity for producing packaging paper and pulp products.