RICHMOND, BC, Jan. 29, 2012 /CNW/ - Catalyst Paper Corporation (TSX:
CTL) advised today that at votes taken this weekend, one union local at
the Crofton mill voted down a new labour agreement while the other
union local voted to support a new labour agreement. Unanimous
ratification of a new labour agreement by January 31, 2012 is a
condition of the company's recapitalization transaction announced on
January 14, 2012.
Local 2 of the Pulp, Paper and Woodworkers Union of Canada (PPWC) voted
down the new labour agreement at a ratification meeting on Saturday.
PPWC represents approximately 380 employees at the Crofton pulp mill.
On Friday, Communications, Energy and Paperworkers Union of Canada (CEP)
local 1132 voted to support the new labour agreement, joining locals 1,
76, 592 and 686 which had earlier ratified the agreement to take effect
at expiry of the current agreement April 30, 2012. The CEP locals
represent 700 employees at the company's Crofton, Powell River and Port
Alberni paper mills. Details of the proposed agreements are not being
disclosed at this time.
"We started discussions with all parties early knowing that difficult
choices lay ahead and that decisions could not be taken lightly to
successfully close a very complicated but vital restructuring process,"
said Kevin J. Clarke, President and CEO. "With five union locals
ratifying the new labour agreement - a commitment to our company that
is very much appreciated - it is disappointing that we could not gain
support of the sixth union local.
"Despite this setback, it's important to recognize that a majority of
employees are making daily contributions that are helping our company
build a bridge to the future. A goal we all share is to put our company
on stronger financial footing which helps keep machines running, helps
save local jobs and supports mill communities - not just for weeks or
months but for years," he said.
The company previously announced that it has reached an agreement with
certain noteholders for their support of a recapitalization through a
plan of arrangement under the Canada Business Corporations Act. The agreement is subject to termination if a new labour agreement with
all union locals at the company's Canadian mills has not been ratified
by January 31, 2012. In addition, implementation of the plan of
arrangement is subject to approval by not less than 66⅔% of the votes
cast by holders of each of the Senior Secured Notes and the Senior
Notes at meetings to be held to consider the arrangement, the approval
of the Supreme Court of British Columbia and receipt of all necessary
regulatory and stock exchange approvals.
For further details on the recapitalization, please refer to the
company's news release dated January 14, 2012 and the filings of the
company available on SEDAR (www.sedar.com), EDGAR (www.sec.gov and the company's web page www.catalystpaper.com). Investors who have questions about the recapitalization may contact
Nancy Turner of Perella Weinberg Partners, the financial advisor for
Catalyst Paper, at 415-671-4550.
Catalyst Paper manufactures diverse specialty mechanical printing
papers, newsprint and pulp. Its customers include retailers, publishers
and commercial printers in North America, Latin America, the Pacific
Rim and Europe. With four mills, located in British Columbia and
Arizona, Catalyst has a combined annual production capacity of 1.9
million tonnes. The company is headquartered in Richmond, British
Columbia, Canada and its common shares trade on the Toronto Stock
Exchange under the symbol CTL. Catalyst is listed on the Jantzi Social
Index® and is ranked by Corporate Knights magazine as one of the 50
Best Corporate Citizens in Canada.
Certain matters set forth in this news release, including statements
with respect to labour costs, work practices and the impact of economic
conditions are forward looking. These forward-looking statements
reflect management's current views and are based on certain assumptions
including assumptions as to future operating conditions and courses of
action, economic conditions and other factors management believes are
appropriate. Such forward looking statements are subject to risks and
uncertainties that may cause actual results to differ materially from
those contained in these statements, including those risks and
uncertainties identified under the heading "Risks and Uncertainties" in
Catalyst's management's discussion and analysis contained in Catalyst's
annual report for the year ended December 31, 2010, and our third
quarter interim report available at www.sedar.com.
SOURCE Catalyst Paper Corporation
For further information:
Lyn Brown, Vice President,
Marketing & Corporate Responsibility