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Abitibi-Consolidated Announces Permanent Closure of Two Newsprint Mills |
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Written by Wire Services
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Wednesday, 14 December 2005 |
Abitibi-Consolidated Inc. today announced the permanent closure of the Stephenville, Newfoundland and Labrador, and Kenora, Ontario newsprint mills.
Today's announcement follows a protracted period of discussions with governments, the unions and other stakeholders. "We could not find a viable long-term solution to return the two mills to profitability," said John Weaver, President and CEO. "These decisions are difficult but essential to achieve our objectives. We recognize the hard work of many committed people but after much effort, we simply could not overcome the inherent challenges facing these operations," added Weaver.
In the fourth quarter of 2005, Abitibi - Consolidated will, on a pre-tax basis, record asset write downs of approximately $155 million and incur mill closure costs of
approximately $50 million, of which $35 million is cash. The Company is proceeding with necessary notifications, severance payments owing and will work in concert with the local communities, unions and governments to provide support services to affected workers.
The Stephenville NFLD plant will see 300 people left jobless as a result of the closures. At least 360 jobs have been lost in the Kenora, Ontario plant. The closures are blamed on high energy costs and poor wood supply. |
