Purchase of the Tasman mill near Kawerau has saved 160 jobs.
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NORWAY’S NORSKE SKOG HAS SOLD THE Tasman pulp and paper mill near Kawerau to another international newsprint company, paving the way for the threatened business to remain in operation.
Last month the Overseas Investment Office (OI) gave its approval for NS Norway to buy Norske Skog’s Kawerau assets for $29.9 million.
“We consider that without this Investment, the Tasman mill and New Zealand-based business of Norske Skog Tasman are likely to be closed down in the short term,” states the OIO, pointing out that Norske Skog was in a “financially distressed” position.
“This Investment is likely to enable the business and Tasman mill to continue operating while it is economically feasible to do so.
“We note that the international paper market is experiencing aggregate oversupply issues and there is generally expected to be on-going decreasing demand for paper products over the longer term.”
The sale also includes 351 hectares at the mill’s Fletcher Ave site in Kawerau and 48ha at nearby Springs Rd, described as “sensitive land” requiring OIO consent.
New owner, NS Norway, is an international newsprint and magazine paper producer that has been operating for about 50 years, largely controlled by US investors.
NS Norway says it intends to continue to run the business from New Zealand in conjunction with its international paper mills and product supply chains across several countries including Australia, Ireland, Poland and Austria.
The deal protects the 160 jobs associated with the mill and also comes as a welcome relief to the forest companies, harvesting contractors and transport operators who supply wood from nearby forests. The mill produces around 150 kilo-tonnes of newsprint annually.
Meanwhile, Juken New Zealand has confirmed that it will go ahead with a multimillion dollar upgrade at its Triboard plant at Kaitaia that will keep it operating for the foreseeable future.
Last month, NZ Logger reported JNL was undertaking a review of the Triboard plant, which has been operating unprofitably. After negotiations with staff and their union, JNL says it will invest in new technology equipment and other refurbishments at the mill, whilst moving from a 24/7 operation to a 24-hour, 5-day week. This will result in some of the 250 staff being made redundant. Discussions are also ongoing to secure logs for the mill, which has faced shortages.