SFK Pulp Fund announces the closing of its public offering



    /NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION
    IN THE UNITED STATES/

    TSX:SFK.UN

    SAINT-FELICIEN, QC, Jan. 31 /CNW Telbec/ - SFK Pulp announced today the
closing of the previously announced offering of 18,400,000 Units of the Fund
(the "Units") (including the Units issued pursuant to the exercise of the
over-allotment option in whole) at a price of $4.70 per Unit for gross
proceeds of $86,480,000 on a bought deal basis. The syndicate of underwriters
was co-led by TD Securities Inc. and CIBC World Markets Inc. and included
National Bank Financial Inc., RBC Dominion Securities Inc., Desjardins
Securities Inc. and Scotia Capital Inc. The net proceeds of the offering will
be used to repay a portion of existing credit facilities of SFK Pulp.
    The offering of the Units is being made in all provinces of Canada by
means of a short-form prospectus. This press release is not an offering of
securities for sales in the United States. The Units have not been registered
under the U.S. Securities Act of 1933, as amended, and may not be offered or
sold in the United States absent registration or applicable exemption from the
registration requirements.

    About SFK Pulp

    SFK Pulp operates, through its subsidiaries, the Saint-Félicien Mill, the
Fairmont Mill and the Menominee Mill (with a total annual production capacity
of 735,000 metric tonnes) and employs approximately 550 people. The Saint-
Félicien Mill (located in Saint-Félicien, Québec, approximately 450 kilometres
north of Montréal) has an annual production capacity of 375,000 metric tonnes
of NBSK pulp and supplies NBSK pulp to various sectors of the paper industry
in Canada, the United States and in Europe for use in speciality products. The
Fairmont Mill (located in Fairmont, West Virginia) and the Menominee Mill
(located in Menominee, Michigan), with a combined annual production capacity
of 360,000 metric tonnes, both manufacture air-dried market recycled bleached
kraft (RBK) pulp and primarily supply RBK pulp to manufacturers of uncoated
freesheet, commercial and away-from-home tissue and coated paper in the
United States.

    Forward-looking Statements

    Certain statements in this press release, including, but not limited to,
expected capital expenditures, expected business strengths of the Fairmont and
Menominee Mills, accretion to Distributable Cash expected from the acquisition
of the Fairmont and Menominee Mills, expected reduction of SFK Pulp's risk
profile as a result of the acquisition of the Fairmont and Menominee Mills,
expected synergies from the acquisition of the Fairmont and Menominee Mills
and other statements that are not historical facts, are "forward looking
statements" which reflect the intentions, plans, expectations and beliefs of
SFK Pulp's management ("Management") regarding SFK Pulp's future growth,
results of operations, performance and business prospects and opportunities.
In certain instances, these statements require Management to make assumptions
and there is significant risk that these assumptions may not be correct. The
words "may", "would", "could", "will", "intend", "plan", "anticipate",
"believe", "estimate", "expect", and similar expressions, as they relate to
SFK Pulp or Management, are intended to identify forward-looking statements.
Such forward looking statements reflect Management's current beliefs and are
based on information currently available to Management. Forward looking
statements involve known and unknown risks, uncertainties and other factors
outside of Management's control. A number of factors could cause actual
results to differ materially from the results discussed in the forward looking
statements including risks associated with the lack of accuracy and
completeness of market and industry data, adverse operating conditions,
unforeseen capital expenditures, changes in prices of raw materials and
operating costs, changes in fibre (including waste paper) costs and
availability, dependence on cross-border trade, vulnerability to economic
conditions, changes in selling prices and volume sold, competition, regulatory
change, foreign exchange, interest rates, reliance on key personnel, uninsured
and underinsured losses, the integration of the Fairmont and Menominee Mills,
the ability to achieve cost and revenue synergies resulting from the
acquisition of the Fairmont and Menominee Mills, potential undisclosed
liabilities associated with the acquisition of the Fairmont and Menominee
Mills, changes in the business strengths of the Fairmont and Menominee Mills,
restrictions on potential growth, refinancing, credit and collection and other
factors referenced in SFK Pulp's management's discussion and analysis for the
year ended December 31, 2005 and in SFK Pulp's continuous disclosure filings,
which may be found through the internet on the Canadian System for Electronic
Document Analysis and Retrieval (SEDAR) at www.sedar.com. Although the forward
looking statements contained in this press release are based upon what
Management believes to be reasonable assumptions, Management cannot assure
investors that actual results will be consistent with these forward looking
statements. These forward looking statements are made as of the date of this
press release, and Management assumes no obligation to update or revise them
to reflect new events or circumstances. Readers are cautioned not to place
undue reliance on these forward looking statements.
    %SEDAR: 00018041EF




For further information:

For further information: Investors & Analysts: Paul Bourque, Chief
Financial Officer, (418) 679-8585, ext. 4600; Media & Other: Louise D'Anjou,
Optimum Public Relations, (514) 282-4733

Organization Profile

SFK PULP FUND

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