St. Francisville paper mill sold for $9.9 million
Published 12:23 am Sunday, April 11, 2010
BATON ROUGE (AP) — A Florida company has agreed to pay $9.9 million to take over the closed Renew Paper mill near St. Francisville.
U.S. Bankruptcy Judge Douglas Dodd, who ordered a court-supervised auction, said he would enter a sale order Monday, clearing the way for Amzak Capital Management LLC to take control of the mill and 610 acres of property within two weeks.
Amzak financed West Feliciana Acquisition’s $16 million purchase of the mill in 2009.
In 2001, Tembec Inc. of Canada paid $185 million for the same site, plus additional acreage. But by 2006, Tembec had lost $200 million on the operation and closed it a year later.
Tembec found a buyer in New York-based PanAmerican Capital LLC, which reopened the plant in July through a subsidiary, West Feliciana Acquisition LLC. The operating company filed for bankruptcy reorganization in January because of a dispute with its contractor, Fluor Enterprises Inc.
The mill, which once employed 200, closed in February, leaving behind a maintenance staff of 14.
The Advocate of Baton Rouge said that Amzak managing partner Scot Fischer refused to say when the mill might reopen. But a company purchase agreement says the new owner plans an eventual payroll of 150 to 200 employees.
The state, which provided an incentive package for Renew Paper, has a secured claim for a $2.1 million loan, including interest, Louisiana Economic Development head Stephen Moret said. The sale should cover that, he said.
Moret said improving paper market conditions should give Amzak a better chance of success and perhaps an expanded payroll.
‘‘We’re optimistic that if they’re able to restart successfully, we may be talking about more than the initial forecast they made,’’ Moret said.
Information from: The Advocate, http://www.2theadvocate.com