Cascades makes multi-million-dollar investment in U.S. newsprint mill

Cascades (Kingsey Falls, Quebec), a leader in the recovery and manufacture of green packaging and tissue products, has announced the acquisition of the White Birch, Bear Island Manufacturing Facility in Virginia for $34.2 million (USD) cash. The newsprint paper machine currently located on the site will be reconfigured to produce high quality recycled lightweight linerboard for the North American market. During the period prior to the conversion, White Birch will temporarily operate the site as a newsprint mill under a 27-month lease. The new machine is expected to have an annual production capacity of 400,000 tons as well as construction costs on a per-ton basis that are competitive with similar conversion projects. It’s estimated that the conversion would require an estimated investment of between $275 and $300 million (USD), with production expected to begin in 2021. Details of the project will be announced when plans are finalized and approved by Cascades’ board of directors, which is expected in the course of 2019.

Mario Plourde.
Mario Plourde.

“This project is directly in line with the goals of our strategic plan which include, among other things, investing in our core sectors of packaging and tissue through modernization, and expanding our geographical footprint,” said Mario Plourde, CEO of Cascades. “In addition to the paper machine that’s particularly well suited for conversion, the Bear Island site is strategically located for raw-material sourcing and logistics. Based on the success of our Greenpac Mill, we expect this to be a highly competitive facility that will significantly contribute to the success of our containerboard operations by supporting our geographic expansion in the U.S. market, in addition to generating solid returns for our shareholders.”

Charles Malo.
Charles Malo.

“The Bear Island site has several advantages, including access to an experienced workforce with expertise in paper making,” said Charles Malo, COO of Cascades Containerboard Packaging. “Moreover, the site provides a platform for continued growth through downstream converting capacity. It’ll also allow us to better serve our customers and to expand our market share by increasing our capacity to provide clients with high quality recycled lightweight linerboard similar to what we produce at our Greenpac Mill.” The company added that its continued focus on projects like Bear Island are aimed at modernizing production facilities in its core sectors of packaging and tissues. It’s also expected that capital expenditures in 2019 will remain at a level similar to 2018, subject to board approval.

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Tony Curcio is the editor of Graphic Arts Magazine.