Fraser files for bankruptcy, closing ME sawmill
Fraser Papers today filed for bankruptcy protection in Canada and the United States. The company says the move will not "immediately" impact its paper mill in Madawaska, but that it will lay off 160 employees at its sawmill in Masardis.
The Toronto-based company says the bankruptcy filing will give it time to restructure its business in the face of continued operating losses, weakened demand and prices for its pulp and lumber, scheduled debt repayments and pension funding obligations, according to a press release from the company. Glen McMillan, Fraser's senior vice president and CFO, this afternoon told Mainebiz the company is operating its sawmill in the Aroostook County town of Masardis only to use up the wood that's already in the yard. He says the mill's 160 employees were notified in late May under the Workers Adjustment and Retraining Notification (WARN) act that they'd be losing their jobs when the mill closes down no later than August 8. Fraser closed its sawmill in Ashland in January 2008. McMillan says both sawmills will be closed indefinitely. "Once the lumber markets get stronger -- whenever that will be -- we'll certainly be in a position to run those mills when they can be profitable," he says.
The company says its paper mills in Madawaska and Gorham, N.H., will continue operations without disruption. The Madawaska mill, which operates five paper machines, employs roughly 700 people, McMillan says. Gov. John Baldacci released a statement this afternoon, saying his administration would continue to work with Fraser to protect its Maine employees. The press release says Fraser CEO Peter Gordon assured him "the filing would not immediately impact the company's operations in Madawaska or the employees there." The governor's statement does not mention the 160 employees being laid off in Masardis.
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