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Resolute in closing paper mill

Paper products manufacturer Resolute Forest Products has announced the permanent closure of its paper mill in Shawinigan, Quebec. Source: Nasdaq

Although the company acknowledged the severity of the decision, which is likely to affect around 275 employees, it maintained that the compromise was the best possible alternative to sustain profitable operations.

The company stated three primary reasons for the strategic decision. These include the reopening of a paper mill by a competitor in 2012, high cost of raw materials like fiber and higher operating costs related to transportation and fuel consumption.

Despite the best efforts of the company to sustain its operations at the 126-year old manufacturing facility, operations were deemed unviable from the financial aspect.

The final curtain on this paper mill will be drawn on or about October 15, 2014.

In order to amicably respond to the legitimate demands of the affected employees, their families and the local community as a whole, Resolute Forest has decided to work with the union representatives and government officials to chalk out a fair compensation plan. This might include due adherence to the relevant conditions in the collective agreements or transfer of employees to other facilities of the company.

Resolute Forest operates more than 40 pulp and paper mills and wood products facilities in the United States, Canada and South Korea, and power generation assets in Canada.

It offers a diverse range of products, including newsprint, commercial printing papers, market pulp and wood products. The company also sells pulpwood, saw timber, and wood chips and recycles newspapers and magazines.