Cascades to Purchase Remaining 50% of Papersource

Cascades Inc., Kingsey Falls, Que., Canada, this week announced that it will purchase the remaining 50% of shares it does not hold in Papersource Converting Mill Corp. (Papersource), located in Granby, Que. The cash purchase price for the acquired shares will be approximately $60 million and Cascades will assume a debt of approximately $25 million, for an approximate corresponding enterprise value of $145 million.

The transaction, expected to be signed in mid-September, is contingent on approval by the Canadian Competition Bureau. The 100% ownership of Papersource will have a positive impact on Cascades' net consolidated results, the company notes.

According to Suzanne Blanchet, president and CEO of Cascades Tissue Group, "with sales of more than $130 million and a consumption of more than 90,000 metric tpy, the acquisition of the remaining shares of Papersource will increase the level of integration of Cascades Tissue Group to more than 70% and will thus strengthen its positioning in the away-from-home segment in Canada and in the U.S."

Alain Lemaire, president and CEO of Cascades Inc., added that "this announcement confirms the firm intention of Cascades to be a key player in the tissue paper sector in North America."

Papersource is a tissue paper converting plant that essentially manufactures products for the away-from-home market. It has more than 160 employees.

TAPPI
http://www.tappi.org/