Cascades to Sell Two U.S. Boxboard Plants to OpenGate Capital
June 14, 2011 - Cascades Inc. said that it has entered into an agreement with OpenGate Capital, a private equity firm, for the sale of two of its boxboard facilities in the U.S. — the Versailles mill located in Connecticut and the Hebron plant located in Kentucky.
Cascades expects to complete the sale on June 23, 2011.
Terms of the deal were not disclosed.
The Versailles mill specializes in the manufacturing of coated recycled boxboard, and has an annual production capacity of 165,000 tons.
The Hebron plant converts coated boxboard into approximately 20,000 tons of folding cartons annually.
Cascades said net proceeds from the transaction will be reinvested in the other boxboard facilities, to improve their operations, efficiency and competitiveness in the years to come. In particular, Cascades plans to purchase new printing presses and other equipments for certain of its remaining folding carton plants.
Cascades' Canadian boxboard mills will also benefit from this transaction through future capital investments, the company added.
"The divestiture of the Versailles and Hebron facilities, following the sales of Dopaco and the Avot-Vallee mill announced earlier this year, is a further step in our overall strategy to gain more financial flexibility and streamline our portfolio of assets in order to better pursue the development of our core operations," said Alain Lemaire, president and CEO of Cascades. "We intend to continue focusing our efforts and investments towards modernizing our packaging and tissue paper facilities to improve productivity and profitability."
Marc-Andre Depin, president and CEO of Norampac (a division of Cascades Canada Inc.) said, "Cascades and OpenGate Capital have made every effort to ensure the transfer of ownership will be seamless for the customers of both facilities.
"We want to thank the Versailles and Hebron employees for their involvement and efforts throughout the years, and wish them every success," he added.
SOURCE: Cascades Inc.