SIG Combibloc (SIG) has agreed to the sale of New Zealand’s Whakatāne Mill Limited (WML) to a consortium of investors who will enable the mill to continue to operate. The consortium is led by Dr Dermot Smurfit who, together with other European consortium members, has extensive experience in owning and operating paper packaging businesses. They have also brought New Zealand investors into the mix including private equity chief Ross George. Source: Timberbiz
A spokesman for the Smurfit Consortium, Mr Ian Halliday, who will become chair of the Whakatāne Mill, said the consortium looked forward to developing a more competitive operation to support customers in New Zealand and around the world.
“We believe that the Whakatāne Mill has a very bright future as the only folding box board mill in Oceania, and we intend to invest heavily in the mill to support both our customers and New Zealand’s forest products industry,” he said.
The mill will cease production of liquid packaging board and going forward will focus on its customers’ requirements for high quality folding box board, carrier board and food service board, all of which are currently manufactured there.
WML General Manager, Juha Verajankorva, said the agreed acquisition by the Smurfit Consortium was a positive outcome and represented a new and exciting era for the mill. All senior management will remain with the new owners. The mill has just over 210 staff in total.
“This is a welcome development for Whakatāne and the wider Bay of Plenty region. It’s also great news for the New Zealand paper packaging sector and we appreciate the positive support of our workforce, our suppliers and customers in working towards this outcome which has been welcomed by all,” he said.
All parties had worked tirelessly to ensure the mill could continue as a leading regional business, after vendor SIG indicated it could no longer sustain the operations of the plant.
“Our preference was always for a sale of these assets so that they could continue to be productive,” Mr Verajankorva said.
“It took until almost the final whistle, but this is a satisfying outcome.”
Confirmation that the Whakatane Mill continues to have a future is great news for the town, the wider region and the New Zealand pulp and paper industry, says the Employers and Manufacturers Assocation (EMA) of New Zealand. The mill has been producing folding box board since the 1930s.
“Whakatane has had to deal with ups and downs in recent years with significant investment from the Provincial Growth Fund generating exciting new developments, mixed with the tragic eruption of Whakaari White Island and its impact on local tour operators, made worse by the COVID-19 pandemic,” EMA Chief Executive Brett O’Riley said.
“The potential loss of the mill, a longstanding EMA member in the region, would have been a further blow as it is one of the largest employers in the town, and a key part of the Eastern Bay of Plenty pulp and paper ecosystem. It’s great news that a rescue package of international and local investors has come together to shore up the future of the mill and the livelihoods of its workers.”
Mr O’Riley says that news of further investment in the mill, with its unique position as the only folding box board mill in Oceania, was a further vote of confidence in its longer-term future.
“It seems as if there is a lot of goodwill towards making this new investment work and while it’s likely there will be some shorter-term transitional issues the longer-term view seems very positive for Whakatane. We will be doing our best to encourage New Zealand exporters to utilise their products.”