RUMFORD — NewPage employees and town officials said Friday that the purchase of the Rumford Paper Co. by Catalyst Paper Corp. is a positive step forward for the community.

Rumford mill spokesman Tony Lyons said the deal happened Thursday evening and mill officials were still processing the decision.

“What I can say is that we’re ready to work and move forward to make sure that this is a successful deal for Verso, NewPage and Catalyst,” Lyons said.

Lyons later said Catalyst agreed to assume the mill’s union contracts and retain the mill’s salaried employees.

“We’re not anticipating any job losses due to this decision,” Lyons said.

Ron Hemingway, president of Local 900 of the United Steelworkers at the Rumford mill, said he was pleased a paper company was buying the Rumford mill and not a holding company.

“Being owned by a paper company should be better for us,” Hemingway said. “From the looks of it, Rumford would be the larger player in the market for coated paper for Catalyst. They appear to be a diversified market, which could be a good thing for NewPage.”

He added, “I think I read in the announcement that they plan to run us, which is also a good thing. That means they’re not buying us to shut us down.”

Hemingway said it was too early to tell whether Catalyst’s purchase of the Rumford mill would result in new jobs or laid-off workers being recalled to their positions.

“We always like to look at everything as positively as possible,” Hemingway said. “I’d like to think this is going to be great for the community, people could put the uncertainty behind them and get back to buying houses and cars and saving money for our children’s future.”

John Madigan, town manager of Rumford and Mexico, said that though the sale was not final, he felt good about certain aspects of the deal.

“One of the things I noticed in Catalyst’s initial press release is that their capital spendings between the Rumford and Wisconsin mills is expected to equal that of their Canadian mills,” Madigan said. “It looks like they’re estimating to spend around $7 million a year for each facility. I’m encouraged by those numbers.”

Madigan said Corporate Knights magazine had named Catalyst one of the 50 best corporate citizens in Canada.

“Now, to me, that’s very important,” Madigan said. “Big businesses around here have always, in the past, tried to be good corporate citizens. Just look at Hugh Chisholm. He built that entire community center and gave himself back to his community. I haven’t seen a whole lot of that from NewPage.”

Madigan said he wanted to wait and see what happens with the NewPage-Verso merger, but he was “pleased with what I’ve seen and heard so far.”

Dixfield Town Manager Carlo Puiia, who served as town manager of Rumford from 2009 to 2013, said Dixfield “certainly has an interest in the mill, in terms of the employment it offers.”

“Until we get some more information, it’s hard to understand what exactly is going to transpire,” Puiia said. “It’s good to know that there’s interest in the Rumford mill from another mill.”

Puiia said the main thing he was taking from Catalyst’s acquisition of the Rumford Paper Co. is “the sustainability of jobs and economy that it generates.”

“I think something like that far exceeds the tax implications or cost to the town,” Puiia said. “That’s paychecks in people’s hands. New money coming in from an outside source is a big thing, and if it gives us a comfort level and makes our jobs more secure, then it’s a good thing. Hopefully, the company will have a long-term interest in us.”

Greg Buccina, chairman of the Rumford Board of Selectmen and a longtime NewPage employee, said he was “cautiously optimistic” about the deal.

“It sounds like it might extend the life of our paper mill, but there are no guarantees in this business anymore,” Buccina said. “I really do think it could be a good thing. It alleviates stress in the whole region about whether or not the mill is staying open.”

He added, “The purchase may even allow us to see some different grade mix created, which would be profitable for the mill. I was looking online about Catalyst Paper, and about the mill in Wisconsin that is being purchased by them, and I think what you have is two good mills with really strong backgrounds in coated ground-wood paper being set up with a deal that could be a good thing for the area.”

John Williams, president of the Maine Pulp and Paper Association, said the sale bodes well for Maine.

“From what I know about it, it sounds great,” Williams said. “It’s hard to know what it means right now, but I think it’s good news. Catalyst is buying (the Rumford paper mill) and one in Wisconsin with the intent to operate them.”

He said he believes NewPage is selling both mills to better facilitate NewPage’s merger with Verso Paper, which has been held up by an antitrust review by the U.S. Department of Justice.

Chip Dillon, a partner at Vertical Research Partners in New York and a longtime paper and packaging industry analyst, agreed.

“Verso’s stock prices barely have value in the stock market, so this does not surprise me,” Dillon said.

He said he didn’t know whether Verso, NewPage and the Department of Justice had made public antitrust conditions, but “the purchase price says they are giving away these mills.”

He was referring to Catalyst’s purchase of Rumford’s paper mill and NewPage’s Biron paper mill in Wisconsin for $74 million in U.S. dollars. He said it would cost $1 billion to build each mill.

“I know that when the Rumford mill was part of the MeadWestvaco system, it was one of their better mills,” Dillon said.

“Seventy-four million to me is optionality — rightly or wrongly,” he said. “I mean, it’s a good thing for the Rumford mill’s employees, because Catalyst is not that big in coated paper, so it is going to want to hang onto it. If I was an employee in the Rumford mill, I would be very happy about this (sale).”

mdaigle@sunjournal.com

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