Grande Prairie’s Weyerhaeuser pulp mill will soon be under new ownership.
Weyerhaeuser recently announced a $2.2 billion deal with International Paper for its cellulose fibers mills, which includes the mill in Grande Prairie.
Wayne Roznowsky, public affairs manager for Weyerhaeuser Canada, said the sale came out of a recent strategic review of the company’s cellulose fibers business.
“That (was a) strategic review that was announced by the board of directors in November and this basically is the result of that review,” said Roznowsky.
When the review was initially announced, the public affairs manager said that the company had discussions with multiple companies interested in purchasing the pulp mills.
The deal with International Paper includes five pulps mills located in Columbus, Miss., Flint River, Ga., New Bern, N.C., Port Wentworth, Ga., and Grande Prairie, which have a combined capacity of close to 1.9 million metric tons. The sale also includes two modified fiber mills in Columbus, and Gdansk, Poland. The deal with International Paper does not include Weyerhaeuser’s liquid packaging board facility or newsprint and publishing papers joint-venture. The review of those assets is ongoing.
“I think it’s important to remember that Weyerhaeuser will still have a sawmill in Grande Prairie along with the forest operations so once this sale is approved, we will still have the sawmill (on the) Grande Prairie site and we will still retain the forest management agreement,” said Roznowsky.
“That will be Weyerhaeuser’s holdings. So Weyerhaeuser is refocusing to that direction and it just made sense at that point to see whether or not there was interest in the pulp mills and clearly there is.”
There are more than 300 people directly affiliated with the pulp mill, with an additional 300 with the timberlands and sawmill, said the public affairs manager.
Weyerhaeuser recently announced it would be purchasing Plum Creek Timber Co. for $8.44 billion to form one of the world’s largest timberland and forest products companies. Under that deal, the company would keep the Weyerhaeuser name and have more than 13 million acres of timberland.
“Ultimately if you look at the other piece of this was the merger with Plum Creek and… focusing the company on an area, basically the land holdings in the United States, plus the wood products materials that we have both in the United States in Canada, the mills, the sawmills, the OSD mills, the construction materials… It’s the direction that the board has chosen,” he said.
The deal is subject to customary closing conditions including a regulatory review, with the expectation that it will close in the fourth quarter of 2016. Until that time, it’s business as usual.