Fortress Global Enterprises Announces Strategic and Financial Initiative
"Current dissolving pulp prices remain well below pricing experienced over the past 10 years." – Giovanni Iadeluca, CEO of Fortress Global Enterprises.
Aug. 22, 2019 - Fortress Global Enterprises Inc. on Aug. 21 announced that, as a result of ongoing financial constraints impacting the Company primarily resulting from a 10-year low in dissolving pulp prices, the Board of Directors has formed a Strategic Committee to consider various strategic and financing alternatives potentially available to the Company, including a recapitalization, restructuring and/or business combination transaction. As part of this process, the Company has engaged Houlihan Lokey Capital, Inc. to act as its financial advisor.
While the Company has initiated this process, there is no certainty that any transaction or alternative will be undertaken or pursued. The Company has not set a definitive schedule to complete its evaluation and no decision on any particular transaction or alternative has been reached at this time. The Company does not intend to disclose ongoing developments with respect to this process, but in accordance with its continuous disclosure obligations, will disclose material developments if, as and when they occur.
In a press release on Aug. 6, Giovanni Iadeluca, CEO of Fortress Global Enterprises, made the following comments associated with the Company's second quarter 2019 results and the global dissolving pulp market:
“Due to a combination of factors, such as a lower realized sales price resulting from decreased dissolving pulp prices, an inventory write-down and production challenges coupled with an extended annual maintenance shutdown, operating results in the second quarter of 2019 were below management expectations. Current dissolving pulp prices remain well below pricing experienced over the past 10 years; however, management believes dissolving pulp prices should trend towards more normalized pricing in the short term.
“With support from our partners, the Company believes it can endure the current market uncertainty in part caused by the trade dispute between China and the United States which is impacting global trade. China represents approximately 65% of the dissolving pulp market.”
Fortress Global operates its dissolving pulp business at the Fortress Specialty Cellulose mill located in Thurso, Quebec, which also operates in the renewable energy generation sector through its cogeneration facility. Fortress operates its bioproducts business through Fortress Advanced Bioproducts Inc., which has laboratory and pilot plant facilities in Vancouver, British Columbia. To learn more, please visit: www.fortressge.com.
SOURCE: Fortress Global Enterprises Inc.