Cascades Closes Scierie Lemay Indefinitely
Kingsey Falls, Quebec, Canada, 09 November 2007 – Cascades (CAS-TSX) announces the shutdown of its operations at the Scierie Lemay mill located in Lac-Saint-Jean (Québec), for an indefinite period.
Eighty-three employees will be affected by the shutdown, which will take place on 30 November. Market conditions in the softwood lumber market and profitability issues drove Cascades’ decision. Cascades is also announcing that talks are currently under way regarding the sale of certain assets of Scierie Lemay to Produits Forestier Arbec S.E.N.C., a company in the region. The planing plant in St-François-de-Salles is not targeted by this decision.
Cascades believes that this potential transaction would be the best possible concrete scenario to ensure a more promising future for the sawmill industry in the Municipality of L’Ascension. Other projects were also considered during the past year, one of which was the re-launching of the mill by the region in partnership with Cascades, but that project was unsuccessful.
"Cascades and the employees of Scierie Lemay have left no stone unturned in their efforts to make the sawmill profitable,” declared Éric Laflamme, president and chief operating officer of Cascades Boxboard Group. “Ten million dollars were invested for the construction of a new sawmill and the implementation of an ingenious recovery program for burnt wood residues. Unfortunately, current prices in the sawmill lumber industry and the high cost of raw materials is what is forcing us to shut down the operations in L’Ascension."
Management at Cascades met earlier today with Union representatives and plant employees to inform them of the terms of this shutdown for an indefinite period and the measures that will be put in place to lessen the blow that this announcement will have on the employees.
Cascades acquired 50% of the shares of Scierie Lemay inc. in 1996 and became the sole owner in January 2004.
Founded in 1964, Cascades produces, transforms, and markets packaging and tissue products composed mainly of recycled fibers. Cascades employs close to 14,000 workers in more than 100 modern and flexible production units located in North America and Europe. Cascades' management philosophy, its more than 40 years of experience in recycling, and its continued efforts in research and development are strengths that enable the company to create new products for its customers. The Cascades shares trade on the Toronto stock exchange under the ticker symbol CAS.