Vancouver’s Canfor Corp. (TSX:CFP) announced it has signed a deal to sell the assets of Howe Sound Pulp and Paper LP to Holland-based Paper Excellence BV.
Financial details of the deal were not disclosed, however, the deal is expected to close in the third quarter of 2010.
Mac Palmiere, Howe Sound’s president and CEO, said he expects operations will be business as usual under the new owners.
The mill is capable of producing 400,000 tonnes of pulp and 230,000 tonnes of mechanical paper and employs approximately 500 people. Canfor and Oji Paper Co Ltd. of Japan have jointly owned Howe Sound.
This is Paper Excellence’s second pulp acquisition in B.C. In April, it announced it was acquiring the Mackenzie pulp mill for $20 million and planned to invest tens of millions before the start of production in the fall.
The Mackenzie mill employed 240 employees before it was shut down in 2008 due to the bankruptcy of previous owner, Pope and Talbot.
Howe Sound Pulp and Paper has remained in operation during the downturn, although last year, it cut 101 jobs, saving the company $20 million a year.
Canfor’s share price range during the past week: between $8.53 and $8.77; 52-week high: $10.99; 52-week low: $4.50.