Pulp producer Fibre Excellence Tarascon in receivership


Market players are worried about the future of pulp producer Fibre Excellence in Tarascon. The company is facing financial difficulties. The search for a buyer is ongoing.

French pulp producer Fibre Excellence Tarascon is facing some problems. The company has been struggling with financial difficulties for some time. In addition, mill employees went on an extended strike only recently.

Now the company has declared that it is insolvent and was placed in receivership, which worries, amongst others, the administration of French department Bouches-du-Rhône as well as the country's forestry and wood industries association France Bois Forêt. Efforts are reportedly underway to find a buyer.

According to Fibre Excellence, the pulp mill is currently down. Operations were stopped on 21 September and will reportedly be resumed in the next days, the company said on 12 October.

The general director of Fibre Excellence Tarascon explained to EUWID that the cost structure of the pulp mill was unfavourable and the mill was not really competitive. A press release of the French department adds that market conditions are currently difficult and that the shareholder - Fibre Excellence - is unwilling to support the mill financially any longer, saying it is not viable.

Then came a strike in September, reflecting the discontent of the workforce. A spokesperson of the Filpac CGT union said that mill workers protested against new working conditions the company wanted to introduce, which included salary and budget cuts. The strike lasted 10 days from 21 September to 1 October.

However, there is still hope for the Tarascon mill. The general director said the mill could be viable if the cost structure of Fibre Excellence's Saint-Gaudens pulp mill would be applied to this site, too. He does not believe that the mill is threatened by closure.

Talks on turbine project continue

Many parties involved are now hoping that the company will be bought by an investor who will keep production running and implement a long-discussed project which envisages installing a new biomass-powered turbine in Tarascon to supply power to the pulp line. The department supports the project, saying it will facilitate negotiations with creditors. The government has promised financial assistance to the company during the restructuring phase to keep operations running and save jobs.

Industry association France Bois Forêt has also expressed concern and says it fears for the survival of a key wood buyer. The Tarascon mill converts 1.15 million t of wood annually. Its closure would be tantamount to a regional crisis, the association remarked.

Fibre Excellence Tarascon has capacity to produce 250,000 tpy of bleached softwood pulp and employs around 280 persons. 50 per cent of the mill's customers stem from the printing and writing paper segment and 20 per cent each from the tissue and speciality paper segments. Only 20 per cent of the pulp produced stays in the country while 40 per cent each of the output is delivered to countries inside and outside Europe.

Fibre Excellence has a second subsidiary in Saint-Gaudens, which is unaffected by the restructuring measure. <spanTimes New Roman"" lang="EN-GB">

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