Asset manager saves Norske Skog

The future of the two Norske Skog Australian paper manufacturing plants looks brighter following the sale of the bankrupt business to Oceanwood, a London based asset manager.

Oceanwood paid €235m for Norske Skog, which has seven manufacturing plants around the world, including the two in Australia, which produce the majority of the majority of the country’s newsprint among other grades, and one in New Zealand.

Norske Skog has been up for sale since it hit the skids in December last year, with more than 100 prospective bidders showing interest in the once mighty business.

Norske Skog’s Boyer mill produced Australia’s first newsprint back in 1941 and remains one of Tasmania’s major employers, with some 270 staff.

Following an $85m upgrade in 2014, the Boyer mill produces around 290,000 tonnes of newsprint, improved newsprint, book grades and lightweight coated grades each year. It was given a $3m grant by prime minister Malcom Turnbull last year to study the effectiveness of a biochemical project.

Norske Skog’s Albury NSW site has 185 staff, its annual production capacity is similar at 274,000 tonnes.

The New Zealand operation has 160 staff, it manufactures up to 150,000 tonnes of paper each year.

While nothing has been set in stone yet Oceanwood investment adviser John Chiang says the company wants to protect the operating companies.

He says, “With the subsequent auction process now concluded, we are very excited to team up with Norske Skog’s management and employees.

“We share the ambition to see the new Norske Skog Group succeed and to realise the potential that we believe is inherent in the business as it continues to transform and grow.”