PaperlinX Closing Tasmania Operations

PaperlinX Ltd. has opted to close its Wesley Vale operation and part of the operations at Burnie in Tasmania, Australia, but is continuing to explore a sale of the remaining operations at Burnie as an alternative to its complete closure. All approvals needed for this decision have been granted.

On completion of this exit, PaperlinX will be solely a merchanting company, with businesses distributing paper, sign and display and graphics materials and industrial packaging in Australia, New Zealand and Asia, Europe and North America.

The exit will occur in two stages, with the first expected to be completed by the end of March 2010, and the second expected to be completed by the end of this coming June.

The first stage will involve the closure of the number 4 paper machine at Burnie and the number 11 and 12 machines at Wesley Vale by the end of this coming March. The Conversion Department of the Wesley Vale Mill will remain operational until all work in progress is converted.

The second stage will involve either the sale of the balance of the Burnie Mill, including the number 10 paper machine and converting operations, or closure, which is expected to complete by the end of June 2010. PaperlinX continues to explore the potential for a sale with discussions ongoing.

“While this was a difficult decision to make, it provides greater certainty for all of our stakeholders and removes one of the key uncertainties that has been overhanging the Company and its employees. To reach this point has been a complex exercise and we will now work to conclude this process expeditiously in the interests of all parties,” said Tom Park, PapaerlinX’s managing director.

“Throughout this process we have received strong support from our Tasmanian employees, even in the face of this great uncertainty. I would like to thank them for their efforts whilst we have pursued the full range of options for these operations. Thank you also to our customers, suppliers and all levels of Government who have worked closely with our team throughout the review process.”