COSMOPOLIS, Wash. (From news reports) -- After a holiday season filled with uncertainty, residents of Cosmopolis could be getting a sense of clarity regarding the town's pulp mill.
Cosmo Specialty Fibers Inc. has gained new ownership following more than 12 years since the mill was bought by The Gores Group, a Los Angeles-based private equity firm, in 2010. The United Kingdom-based firm, Charlestown Investments, is the new owner.
Speaking via phone interview, Charlestown Investments CEO Robert Buchan said he and the new owner of Cosmo Specialty Fibers Inc. Richard Bassett became interested in acquiring the mill in early December 2022.
"(Bassett) and I had come down at the beginning of December to have a look and do a bit of diligence and talk to some state and local people because he was considering buying the mill," Buchan said. "(Bassett) saw that there was great possibilities for this mill beyond selling commodity product to China which is what the mill did. We think putting all your eggs in one basket in China right now is increasingly risky and we want to work into more specialty products, that are not commodities that have better margins, are sold elsewhere."
According to Buchan, the long-term goal would be to diversify the mill and expressed they have received support from Washington Gov. Jay Inslee's office as well as Congressional Rep. Derek Kilmer's office about what the federal government is doing to encourage American manufacturing.
"There isn't a guarantee of success upon this but (Bassett) believes it's worth taking and he believes that there's going to be other people that will want to be part of this," Buchan said.
Although Buchan declined to comment as to what the cost of acquiring Cosmo Specialty Fibers Inc. was, he did acknowledge that in the transfer of ownership, The Gores Group accepted the responsibility of the outstanding debt attached to the mill which ranged from "six to seven figures worth."
When asked what the current plans of the Cosmopolis-based pulp mill are, Buchan said the ownership group is currently performing audits of the company's prior financial statements which he said not only takes time but is normal when investment firms acquire assets. Buchan also said the ownership group needs to address facility needs and repairs before reopening.
"There are some things popping up that some we were aware of and some we were not," Buchan said. "Basically, for the last year or so, there was an effort here to cut costs causing the employees here to be undermanned. Repairs that didn't add much to the bottom line were deferred too."
Buchan said there is no estimation yet for the total costs of repair but did point out that the mill owed a lot of money to suppliers, which they are currently working on resolving. As for when the more than 170 workers from the mill could expect to return to their job, Buchan acknowledged it's dependent on repairs being completed.
"We've told employees that we're anticipating an end-of-March goal to get going again, but what we're finding is that it's becoming a little more flexible," Buchan said. "There's no question that this is a much more mobile labor market than the first time in 2010 when the mill was reopened, and these are skilled employees and we're going to lose some."
While the hope is all the currently unemployed workers will return, Buchan understands it could be hard for some to wait it out without seeking employment elsewhere. He says that health and dental insurance have been extended to all workers until the end of the month as well as noting that 401K plans will be transferred from The Gores Group plan to Charlestown Investments plan upon getting rehired.
Buchan said the March goal was made so there would be an urgency to get the mill to reopen and hope that workers could wait, but it remains unclear if that timeline is achievable. Employees are kept up-to-date about the progress of the mill reopening status.
|
