Paper Excellence has agreed to sell Domtar's Kamloops pulp mill in British Columbia following its acquisition.
The Canadian Competition Bureau has approved the takeover of pulp and paper manufacturer Domtar by Paper Excellence subject to conditions. Despite competition concerns, an agreement was reached to allow the merger to proceed. A prior review of the proposed transaction indicated that an unconditional merger would significantly reduce competition in the wood fibre market in the Thompson, Okanagan region of British Columbia. Paper Excellence would have gained a monopoly position in a large part of southern British Columbia. the Bureau stated. The company would be able to pay below-market prices to sawmills and other wood fibre suppliers in the region, where it already has several pulp mills. To address the Bureau's concerns, Paper Excellence has agreed to sell Domtar's pulp mill in Kamloops, British Columbia, following its acquisition.
The site has the capacity to produce approximately 400,000 tpy of bleached and unbleached northern softwood kraft pulp on one production line. The sale is to be made to an independent buyer, subject to approval by the Canadian Competition Bureau. The Competition Bureau said it was satisfied that the divestiture would resolve the competition issues arising from the proposed acquisition.
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