Great Lakes Pulp Co. (GLP) and Beltech Recycling L.P., formerly known as American Fiber Resources (AFR), have agreed to merge ownership into a holding company that will manage the activities of both deinked market pulp mills. GLP's shareholders and AFR Holdco, the parent holding company of AFR approved the merger plan, which actually went into effect near the end of August.
Lars Dannberg, president and CEO of GLF (Menominee, MI), will serve as president of the consolidated companies. According to Dannberg, the consolidation "positions the companies to achieve preeminent status in the deinked market pulp industry with synergies and economies of scale. We believe this is the first step toward consolidation of this fragmented industry."
He added that "our majority shareholders, Cerberus Partners, L.P., and Oaktree Capital Management, LLC, assisted both GLF and AFR in the development of financial restructuring and recapitalization plans that were implemented through pre-negotiated Chapter 11 filings."
In a related move, shareholders of the parent holding company elected a new board of directors. The newly elected directors are: Brian Berman, asst. VP, Oaktree Capital Management; Lars Dannberg, president and CEO, Great Lakes Pulp; Sven-Erik Henriksson, president S.E.H. Engineering; Malcolm Hopkins, private investor and consultant; Stuart Lang, CEO, Great Lakes Pulp and vice chairman, Crestbrook Forest Industries Inc.; and Joyce Johnson Miller, managing director, Cerberus Partners. The holding company is expected to be renamed within the next few weeks.
The Great Lakes mill has an average daily production of 520 tons/day of bleached, deinked, air-dried market pulp from mixed office wastepaper, with the capacity to produce up to 745 tons/day. The mill uses a two-stage flotation deinking and a peroxide-anchored bleaching sequence.
The AFR mill (Sanford, WV) produces some 600 daily tons of air-dried, bleached, deinked market pulp from mixed office wastepaper, and has the deinking line capacity to produce 840 tons/day. It also has a two-stage flotation deinking system and a bleaching operation similar to that at the GLP mill.
Both companies' products are sold worldwide by Mead Pulp Sales for use in recycled fiber applications, and as a virgin pulp substitute. GLP is fully commissioned and AFR will be fully commissioned in the near future.