The Paper Excellence Group, a manufacturer of pulp and specialty printing, writing and packaging papers with headquarters in Richmond, British Columbia, has completed its acquisition of Domtar, a provider of fiber-based products based in Fort Mill, South Carolina. Paper Excellence Group produces more than 7 million tons of pulp and specialty, printing and writing and packaging papers per year with a workforce of more than 10,000 people at nearly 40 locations across the Americas and Europe.
The company initially announced the acquisition, representing a value of about $3 billion, in May. According to a news release from Paper Excellence Group, the acquisition will broaden the company’s reach and expand its product range to include air-laid nonwovens and containerboard in addition to increased pulp and paper production. Paper Excellence also owns pulp and paper mills that had been operated by the former Catalyst Paper.
Currently, Domtar is in the process of converting a printing and writing mill into a containerboard mill in Kingsport, Tennessee. The company announced in August 2020 it intended to invest between $300 million and $350 million in that facility, which will produce 600,000 tons per year of recycled-content linerboard and medium. The company says that mill will consume about 700,000 tons of recovered fiber per year to produce that containerboard. That project is expected to be completed by the first quarter of 2023.
Domtar will operate as a stand-alone business entity within the Paper Excellence Group. Domtar’s President and CEO John Williams as well as its management team also will remain the same, according to Paper Excellence Group.
“We are excited to welcome Domtar and its impressive team to the Paper Excellence family,” says Joe Ragan, global chief financial officer of Paper Excellence. “Under John Williams’ and Domtar’s capable management, we look forward to Domtar’s continued success across its manufacturing network in the U.S. and Canada.”
Williams adds, “We will continue to earn the right to be the supplier of choice to our customers with sustainable paper, pulp and packaging products.”
Barclays served as the exclusive financial advisor to Paper Excellence and Latham & Watkins LLP, McMillan LLP, Miller Titerle + Co. and Mehigan LLP served as legal advisors to the Paper Excellence Group. Morgan Stanley & Co. LLC served as the exclusive financial advisor to Domtar and Debevoise & Plimpton LLP and Osler, Hoskin & Harcourt LLP served as its legal advisors.
Under terms of the agreement, Domtar stockholders received $55.50 for each share of Domtar common stock. Domtar common stock will no longer be listed on the New York Stock Exchange or the Toronto Stock Exchange.