Oak Brook, IL /PRNewswire/ - ND Paper LLC ("ND Paper"), a wholly-owned subsidiary of Nine Dragons Paper (Holdings) Limited (the "Company" or "Nine Dragons"), announced that it has entered into a definitive asset purchase agreement (the "Agreement") with Resolute Forest Products Inc. ("Resolute" or the "Seller"), pursuant to which Nine Dragons will acquire Resolute's recycled bleached kraft pulp mill located in Fairmont, West Virginia (the "Fairmont Mill") for US$55 million plus certain elements of working capital, payable in cash. Nine Dragons plans to fund the acquisition through existing cash on its balance sheet.
"We are thrilled to add the Fairmont Mill to Nine Dragons' global portfolio," said Ken Liu, CEO of ND Paper. "Our acquisition of the Fairmont Mill enables us to further our US and global growth, and sustains the momentum commenced by our recent acquisitions of the Biron, Wisconsin and Rumford, Maine pulp and paper mills acquired from Catalyst Paper in Q2 2018. Not only is this transaction consistent with our long-term strategy of environmentally-sustainable papermaking, but also it further supports Nine Dragons' company-wide fiber sourcing requirements and global growth initiatives."
The Fairmont Mill is engaged in the business of manufacturing and distributing recycled pulp used in a wide range of products, from packaging to tissue paper. Located in the northern part of West Virginia, the Mill has an annual production capacity of approximately 218,000 metric tonnes, and is one of three pulp mills in the world that produces air-dried recycled pulp. The acquisition is expected to generate significant benefits for both the Mill and Nine Dragons. ND Paper will gain access to high quality recycled pulp and diversify its manufacturing base, while the Fairmont Mill, through an increase in capital investment, will expand its current capabilities and inject growth into the West Virginiaeconomy, particularly in the surrounding community.
ND Paper has agreed to offer employment to Fairmont mill employees, effective upon closing of the acquisition; closing is expected to occur in the next two months and is subject to customary closing conditions and approvals.
Sonenshine Partners LLC is acting as the exclusive financial advisor to Nine Dragons, and Jones Day is acting as the Company's legal counsel.
BMO Capital Markets is acting as the financial advisor to Resolute.
About ND Paper LLC
ND Paper LLC is a wholly-owned subsidiary of Nine Dragons Paper (Holdings) Limited, an environmentally friendly manufacturer of various types of paper and paper-based products. Nine Dragons is the largest containerboard producer in China and Asia and a leading paper product manufacturer globally. It is primarily engaged in the production and sale of a broad variety of packaging paperboard products, including linerboard, high performance corrugating medium, coated duplex board, as well as recycled printing and writing paper and specialty paper. It operates nine mills and 39 machines with total annual production capacity of over 14 million tonnes. Nine Dragons was established in 1995 and listed on the Main Board of the Hong Kong Stock Exchange on March 3, 2006.
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