Buckeye to close Canadian airlaid plant.
Buckeye chairman John Crowe attributes several factors to the closure, including an unfavorable site location relative to customers and raw material suppliers, a strong Canadian dollar and low capacity utilization. "It is unfortunate that this closure will result in the eventual termination of employment for approximately 95 dedicated employees," he says.
Buckeye has owned and operated the Delta facility since 1997. In the fall of 2010, the company consolidated its production from a two-machine operation to one airlaid machine to improve profitability. While margins did improve following this consolidation, the plant's forecasted financial performance remains at an unacceptable level, Crowe says.
Buckeye expects to incur a noncash asset impairment charge of about $15 million and $5 million in restructuring expenses between now and December 31, 2012. The closure is expected to generate about $30 million in cash over the next 18 months, primarily through the sale of land and buildings and a net reduction in working capital.
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|Title Annotation:||WIPES MARKET WATCH|
|Publication:||Household & Personal Products Industry|
|Date:||Sep 1, 2011|
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