MONTREAL — Resolute Forest Products Inc., a subsidiary of Domtar Corp. and a part of the Paper Excellence Group, has signed a deal to sell its pulp and paper mill in Thunder Bay, Ont., to an affiliate of U.S. company Atlas Holdings.
The sale of the mill is a requirement under an agreement between Domtar and the Competition Bureau in connection to the company’s acquisition of Resolute. This acquisition will continue to operate its sawmills and woodlands operations in northwestern Ontario.
Resolute Forest Products has stated that once the sale of the mill is complete, it expects to enter into a long-term wood chip and biomass supply deal. This agreement will ensure the continued provision of chips and biomass to the operation’s needs.
The transaction is expected to close in the second half of the year but is subject to regulatory approvals and other closing conditions.
Background on Resolute Forest Products
Resolute Forest Products Inc., based in Thunder Bay, Ont., has been a key player in the forest products industry. Its operations include pulp production, paper manufacturing, and sawmills, which play a vital role in supporting the region’s economy and local communities.
The sale of its pulp and paper mill marks an important step in Resolute Forest Products’ strategic restructuring. This move aligns with the company’s broader goals to optimize its assets and enhance operational efficiency.
Financial Aspects
The financial terms of the deal were not immediately available at press time. However, it is understood that the transaction values are significant given the mill’s historical contributions to the region’s industrial base.
Resolute Forest Products has emphasized the importance of maintaining operations in northwestern Ontario after the sale. The company will continue to serve its customers with high-quality wood chips and biomass while awaiting the closing of the deal.
Regulatory approvals
The approval process for the mill sale is currently under review by relevant authorities. Resolute Forest Products has stated that all necessary regulatory clearances have been obtained, but the final approvals are pending.
Once the deal closes, the company expects to enter into a long-term supply agreement with its customers, ensuring uninterrupted operations and continued business growth in the region.
Market Impact
The sale of the pulp and paper mill is part of Resolute Forest Products’ strategic plan to realign its portfolio with market demands. By focusing on core competencies, the company aims to enhance its operational capabilities while optimizing resource utilization.
This move is expected to strengthen the company’s position in the North American forest products industry, particularly in the sawmill and biomass sectors.
Closing Thoughts
The sale of Resolute Forest Products’ pulp and paper mill is a significant milestone for the company. It reflects its commitment to long-term sustainability and operational excellence in northern Ontario.
As the transaction progresses, the impact on local stakeholders, including communities, businesses, and customers, will be closely monitored. The successful closure of this deal will have far-reaching implications for the region’s economic development and industrial growth.
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