Future of Lincoln paper mill in doubt after liquidation firm wins auction
A bankruptcy judge has approved a bid for the Lincoln Paper and Tissue mill from a group led by a Boston-based liquidator of industrial sites.
The bidder, Gordon Brothers Group, is a liquidator, but it could resell the mill to a company seeking to make tissue paper, the attorney for the bankrupt tissue mill told the Bangor Daily News. Its bid of $5.95 million was approved by a federal bankruptcy judge Friday morning.
Thursday's six-hour Chapter 11 bankruptcy auction opened with a bid of $5.3 million. None of the four eligible bidders that participated in the auction were paper mill operators.
Jeffrey Young, an attorney with the firm representing the United Steelworkers union, which still has 75 employees working at the mill, told Maine Public Broadcasting Network on Thursday that “it appears almost certain that the mill is going to be dismantled and sold to a salvage operation.”
“This is a sad day really for the employees at Lincoln Pulp and Paper,” Young said. “The mill has been operating, in one form or another, for about 80 years.”
The BDN reported Friday morning that Young said Keith Van Scotter, CEO of Lincoln Paper and Tissue, indicated in details emailed employees late Thursday that the sale proposal did not include the current union contract.
Van Scotter told the Portland Press Herald he was disappointed no paper operators participated in the auction and the winning bid was less than he expected, but he said he hopes the new owner will still seek a paper operator.
Van Scotter has cited struggles recovering from a boiler explosion in November 2013 as a reason for the Chapter 11 bankruptcy filing this fall. The mill has about 175 workers, down from 400 in 2013.
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