February 20, 2018
Business Latest News | Poll Questions | Tourney Time 2018 | Richard Gates | Winter Olympics

Rumford paper producer eyes taxpayer-backed loan for tissue machine

By Darren Fishell, BDN Staff
Updated:

Canadian papermaker Catalyst Paper wants Maine taxpayers to back a loan of up to $25 million to help it purchase a machine to make tissue paper at its mill in Rumford.

The company has applied to the Finance Authority of Maine for a $25 million loan under the agency’s Major Business Expansion program, according to minutes from the authority’s April meeting.

If approved, it would be only the second project to get financing through the program. The other project was also for a tissue paper machine, with $7.5 million approved for the $120 million installation of a tissue machine at St. Croix Tissue in Baileyville.

Eduarda Hodgins, a spokeswoman for Catalyst, wrote in an email that she can’t comment on the company’s plans, but wrote that “Catalyst is continuously looking at opportunities to improve the business.”

In May, minutes indicate that a FAME committee asked agency staff to seek support of a credit rating agency and to “obtain a market study of the industry” for the request.

Bill Norbert, FAME’s spokesman, wrote in an email Thursday that the industry study has not yet been ordered.

Norbert wrote Friday that the finance authority received the application under the name Pacific Falcon Corp. on April 10, requesting the program maximum of $25 million to add a tissue machine at the mill.

FAME previously approved an initial $25 million under the program for Cate Street Capital’s wood pellet venture, Thermogen, planned in Millinocket. It later reduced that authorization to $16 million after Thermogen altered its core technology, but the deal never came to pass.

Catalyst purchased the mill from Verso in 2015 as part of a settlement with antitrust regulators that allowed Verso to acquire its larger competitor, NewPage.

The Richmond, British Columbia-based Catalyst last year reached terms to be purchased by the Indian firm Kejriwal Group International, but its shareholders nixed the deal in December in favor of a different deal to infuse new capital into the company.

 


Have feedback? Want to know more? Send us ideas for follow-up stories.

You may also like