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Kap's Spruce Falls sold to Quebec-based company.

Kap's Spruce Falls sold to Quebec-based company

After months of speculation, the Spruce Falls Power and Paper Company Ltd. in Kapuskasing has been sold.

In late June, it was announced that Kimberly-Clark Corporation and The New York Times Company agreed in principle to sell their joint interests in the operation to Kruger Inc.

Kruger Inc. is a private, Montreal-based company. It currently employs about 5,000 people in Canada and owns and operates pulp and paper mills in Montreal, Bromptonville and Trois Rivieres, Que., as well as Toronto and Corner Brook, Nfld.

The company also has operations in Europe and South America.

The deal is expected to be finalized in the next few months.

No price tag has been released for the sale.

In a telephone interview, Spruce Falls president Fred Campling hesitated to speculate if the purchase will mean either cutbacks or an expansion at the mill.

However, he said, "I think it's a positive move. It bodes well for the future of Kapuskasing and the operations in Kapuskasing."

The fact that Kruger wants the mill is a positive sign, noted Campling.

"You only buy things if you want them," he explained. "It's a very simple matter. It's like buying groceries."

The sale ends months of rumors about the future of the operation, and Campling believes it is good to finally have the matter decided.

However, he said, "There's still a great deal of uncertainty. No one knows what the future will hold in a concrete way."

Campling pointed out that the sale will make Kruger the third largest company in the pulp and paper business in North America, behind Abitibi-Price and Canadian Pacific Forest Products.

"Kruger is a very well-known company in the pulp and paper business," he added. "They're big. This isn't a small deal."

Campling said the Spruce Falls mill and woodlands operations employ about 1,700 people, although the number varies seasonally.

In a joint statement, Darwin E. Smith, chairman of the board and chief executive officer of Kimberly-Clark, and Arthur Ochs Sulzberger, chairman of The New York Times Company, stated, "Our intent was to find a new owner for Spruce Falls who would be in a better position to capitalize on the strengths of the company and to secure the long-term interest of the mill.

"Kruger Inc. is a Canadian company with newsprint production facilities at other Canadian locations. By joining with Kruger, Spruce Falls will be better able to cope with changing business conditions which make it difficult for a single mill in a remote location to effectively meet customer demands."

The release also stated that Spruce Falls, the parent companies and Kruger Inc. will work closely with the local, provincial and federal governments to ensure a successful transition of ownership.

In the interim, Spruce Falls will continue to operate normally.

The mill produces newsprint and groundwood printing papers.

Kimberly-Clark owns 50.5 per cent of Spruce Falls Power and Paper Company and The New York Times owns the remaining 49.5 per cent.
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Title Annotation:Forestry News; Kapuskasing; Spruce Falls Power and Paper Company Ltd.
Author:Bickford, Paul
Publication:Northern Ontario Business
Date:Aug 1, 1990
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