Manufacturing AUTOMATION

Cascades to close Quebec kraft paper plant, 175 jobs affected

July 9, 2014
By The Canadian Press

Cascades is ending its production of kraft paper with the closure this fall of a paper plant in East Angus, Que., affecting 175 jobs.

The recycled paper and packaging company says the closure, to take place by October 3, is due to unfavourable market conditions and the inability to finalize a sale of the plant.

Cascades says it has been unable to remain competitive amid weak market conditions and the decision by competitors to convert their newsprint paper machines to produce kraft paper, an oatmeal-coloured paper used for promotional materials and for some fast food wrapping.

Employees were told last November that the company would exit the kraft business, but attempts were made to sell the plant and save the jobs.

The company says it worked with the Quebec government to develop a financial package, but the project was abandoned because of a lack of new investors.

The paper plant began operations in 1881 and was bought by Cascades in 1983.

The closure doesn’t affect its coated boxboard manufacturing plant, also located in the same Eastern Townships community.

Cascades says its strategy is to focus on growth in the packaging, tissue paper and recovery sectors.

The company announced earlier this month the sale of its fine papers division to Rolland Enterprises Inc., a subsidiary of H.I.G. Capital, for $39.5 million.

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