Borregaard: US lignin raw material supplier Flambeau River Papers in financial difficulties
May 09 2019 - 10:00AM
One of Borregaard's suppliers of lignin raw
material, Flambeau River Papers LLC in Wisconsin, USA, announced 8
May 2019 that it has undertaken an Assignment for the Benefit of
Creditors under Chapter 128 of the Wisconsin Statutes. This is a
voluntary debt consolidation and administration mechanism taking
place in the Wisconsin Circuit Court system. The proceeding
is a state procedure which is similar to a federal US Chapter 11
bankruptcy which is commonly used by companies in financial
difficulties in Wisconsin. The company has announced that it will
continue to operate in the ordinary course of business under the
control of a receiver, but due to declining paper markets Flambeau
will shut down one production line for paper in addition to the
idling of one machine this winter. A spokesperson for
Flambeau has declared that a buyer is being sought for the
company.
In the event that raw material deliveries from
Flambeau will be reduced or terminated, Borregaard will supply
North American customers from other manufacturing sites.
The book value of the intangible assets related to
the acquisition of the Flambeau lignin business was USD 3,1 million
as of 30 April 2019.
Borregaard acquired Flambeau's lignin business in
2015 and entered into a long-term supply agreement for lignin raw
material of approximately 40,000 tons per year. See stock exchange
releases of 21 October and 3 November 2015.
Sarpsborg, 9 May 2019
Contact:
Jørn Syvertsen, Director Investor Relations, +47 958 36 335
This information is subject
to the disclosure requirements pursuant to Section 5-12 of the
Norwegian Securities Trading Act.
This
announcement is distributed by West Corporation on behalf of West
Corporation clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Borregaard via Globenewswire
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