Stalled union talks jeopardize Fraser
Bankrupt Fraser Papers could be forced to close its mill in Madawaska and lay off its 680 employees if unions refuse to accept a new contract that includes $4 million in concessions.
The Toronto-based company is in talks with United Steel Workers Union Locals 365, 291 and 1247 and has been trying to reach an agreement on a new three-year contract as part of the company's bankruptcy restructuring, according to the Bangor Daily News. The contract is one of three conditions for Fraser to sell its specialty paper business assets, including the Madawaska mill and two lumber mills in New Brunswick, to a newly formed company.
In December, the Ontario Superior Court approved Fraser's restructuring plan, which includes majority shareholder Brookfield Asset Management Inc. converting its debt into a 51% majority ownership of the new company, the New Brunswick government converting its $35 million loan to Fraser into preferred stock, and CIT Business Credit Canada Inc. providing $50 million in operating liquidity. "If this doesn't go through, this could put Fraser in a position where all of Fraser's assets could be at risk," Bill Peterson, the company's human resources director, told the paper.
The unions voted down contracts in November and again last week. Negotiations were scheduled to continue yesterday.
Go to the article from the Bangor Daily News >>
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