A 50 per cent stake in Quesnel mill Cariboo Pulp and Paper (CPP) has been acquired by Mercer International.
Mercer is one of the world’s largest producers of market pulp, according to its website, and has bases in Seattle, Vancouver and Berlin, Germany.
Mercer bought the CPP stake via the acquisition of Daishowa-Marubeni International (DMI), which had the 50 per cent interest in the Quesnel mill. DMI also owns and operates a mill in Peace River, Alberta.
CPP is a joint venture with West Fraser, which will still own the other 50 per cent stake. CPP employs around 350 people, according to the Mercer press release.
The deal cost Mercer a total of USD $359.2 million (CAD $465 million).
“Both the [Peace River] PRP and CPP mills currently have solid operating platforms in place, which can be further enhanced through improved efficiencies and capital improvements. We are delighted to welcome the employees of DMI to the Mercer team and, consistent with all our operations, we look forward to working with our new government, community and First Nations partners in alignment with our core values of health and safety, sustainability, integrity, innovation and performance excellence,” said Mercer CEO David M. Gandossi.
The transaction is subject to customary closing conditions, including receipt of requisite regulatory antitrust approvals. The news release says the acquisition is expected to close in the fourth quarter of 2018.
“Mercer, as the new shareholder of DMI, will operate under the same terms as the current joint venture agreement,” says Tara Knight, who works in West Fraser’s communications department.
“West Fraser maintains its 50 per cent stake in Cariboo Pulp & Paper and will continue to be responsible for day to day operations at the mill. We look forward to welcoming a new partner to the business.”
Bruce Eby, general manager of CPP in Quesnel, declined to comment.