Judge approves process to sell off Northern Pulp assets
The sale of Nova Scotia timberlands, Crown land leases, and a nursery controlled by Northern Pulp has been authorized by a B.C. Supreme Court justice, Justice Shelley Fitzpatrick. This approval comes after Macer Forest Holdings submitted a $104-million bid for the assets, positioning themselves as the stalking horse bidder.
The stalking horse agreement allows Macer to acquire the assets unless other interested parties come forward by Nov. 20. An auction will be held if additional bidders are identified, with bids starting at the stalking horse price and increasing by at least $200,000 increments. If Macer is outbid at the auction, they could receive compensation of up to $3.1 million.
This development follows Northern Pulp’s decision last month to abandon plans for a new mill in Liverpool, N.S., citing financial constraints. The proceeds from the asset sale will be used to pay off Northern Pulp’s debts, including funds borrowed from parent company Paper Excellence, pension plan obligations, and repayment of loans from the Nova Scotia government.
While there is supposed to be $15 million allocated for a closure plan for the former mill site at Abercrombie Point, court filings suggest that there may not be enough funds remaining after settling other debts. This could potentially lead to Northern Pulp declaring bankruptcy if additional funds are not generated through the auction process.
The Nova Scotia Environment Department confirmed that Northern Pulp has not submitted a reclamation plan for the site. Justice Fitzpatrick extended Northern Pulp’s creditor protection until Dec. 19, with hopes that the asset sale will be finalized by then.
As this process unfolds, the fate of Northern Pulp and the future of the former mill site remain uncertain. Stay tuned for further updates on this ongoing saga.
