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SP Newsprint could soon go on the block for sale |
By David Sale, Newberg Graphic reporter
E-mail David at
dsale@eaglenewspapers.com
|
Could Newberg’s paper
mill be sold? That’s one possibility in the corporate restructuring
of Atlanta-based SP Newsprint, which the company announced May 17.
The company has contracted with brokers TD Securities USA to
explore a range of options, including the sale of some or all of its
assets.
“It’s a complete strategic review for SP,” said Christine Stenson,
a spokeswoman for the company. “We’re looking at options for the
whole company.”
SP is the fifth largest newsprint producer in North America and one
of Newberg’s largest employers with 290 mill workers. Located on
Wynooski Road, the paper mill has been in operation in some shape or
form since 1892. SP purchased the mill from Smurfit-Stone Corp. in
1999.
The company also owns a newsprint mill in Dublin, Ga., and a
recycling division, SP Recycling Corp., which is the second largest
producer of 100 percent recycled newsprint in the nation.
Total annual production runs about 1 million tons of paper,
amounting to sales of $638 million in 2006. Nevertheless, declining
newsprint demand — which fell 20 percent last year — has left the
company in an unstable position, Stenson said.
“The marketplace has changed quite a bit,” she said. “This
significant decline in newsprint use has led to consolidation in the
industry.”
Besides selling the Newberg mill, another possible strategy is
splitting SP’s recycling operations from its newsprint
manufacturing, Stenson added.
“There’s no buyer yet — we’re still in the very early stages of the
review,” she said.
In January, the mill won a $146 million property tax cut from
Yamhill County, following negotiations with the assessor’s office.
Company officials cited decreased sales and high fuel prices that
affected the mill’s cogeneration plant, which consists of two
natural gas-fired turbines which supply electricity to the mill.
The company is a joint-venture partnership of three large American
newspaper chains: Cox Enterprises, based in Atlanta, Ga.; Media
General Inc., based in Richmond, Va., and The McClatchy Co., based
in Sacramento, Calif.
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Published
May 23, 2007, Newberg Graphic
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