Connecticut Newsprint to Build Recycled Newsprint Mill.

BRIDGEPORT, Conn.--(BUSINESS WIRE)--Sept. 19, 1997--Connecticut Newsprint, LLC, based in Bridgeport, CT, has announced plans to build a new recycled newsprint mill. The new mill will have a production capacity of more than 200 thousand metric tons per year of newsprint made entirely from recovered old newspapers and magazines. State-of-the-art recycling and paper manufacturing technology will produce 100% recycled newsprint to the highest newspaper publishing industry specifications.

James L. Austin, President and CEO of Connecticut Newsprint, announced that the company has signed a preliminary agreement with Raytheon Engineers & Constructors, Inc., Birmingham, AL office, pursuant to which Raytheon will design the plant and enter into a definitive agreement for the equipment, procurement and construction of the mill.

Detailed engineering and construction activities of the Connecticut Newsprint mill are expected to begin during the second quarter of 1998. The construction phase will employ 400 to 500 people, and contribute approximately 1,000 indirect employment opportunities. Once completed and operational, the mill will employ approximately 150 people and generate an additional 750 indirect employment opportunities. This project will have a significant positive impact on the tax revenues of the city and state.

The State of Connecticut has committed a $500,000 economic development grant to the project. Governor John Rowland reported that he is "delighted to welcome Connecticut Newsprint to the State of Connecticut. The project represents an enormous economic and human resource opportunity for the region, and we are ready to assist in any way." Bridgeport Mayor Joseph P. Ganim has actively supported and encouraged the development of the project.

Greenwich Partners, LLC, Greenwich, Connecticut, and Morgan Stanley and Co., Inc., New York, New York, will lead the bond financing. Thompson Avant International, Inc., Atlanta, Georgia, is serving as the independent feasibility consultant for the project. Wright Investor Services, Bridgeport, Connecticut are financial advisors. Grunow Group Capital Management, Inc., Stamford, Connecticut arranged for equity funding of the development effort. People's Bank, Bridgeport, Connecticut, is the Company's lead bank. Environmental Risk Limited, Inc., Bloomfield, Connecticut is acting as environmental consultant to the Company. Haythe & Curley, New York, New York, Pullman & Comley, Bridgeport, Connecticut and Quatrella & Rizio, Fairfield, Connecticut will serve as counsel to the project.

The mill will become operational in late 1999. Once production begins, the mill will satisfy about 8% of the annual demand for newsprint in the Northeastern and Mid-Atlantic states. Fifteen to twenty major publishers and printers will consume about 80% of the new mill's annual production under long term contracts. The mill will draw old newspaper and magazines as raw materials from Connecticut and surrounding areas.

CONTACT: Connecticut Newsprint, LLC

James Austin, [phone]