Marshall open to Corner Brook mill financing
Finance Minister Tom Marshall says Newfoundland and Labrador is willing to support the struggling Kruger newsprint mill in Corner Brook with some sort of financing, even thought direct subsidies have been ruled out.
Most unionized members of the Corner Brook Pulp and Paper workforce gave their approval Friday night to a new contract that cuts wages. Workers and pensioners will be asked in August to back a pension restructuring plan.
Marshall said Kruger, which is also rolling out a cost-cutting plan this summer, could get a favourable ear for some sort of financial help.
"There are different ways that we can offer support to the mill," he told CBC News.
"It can be a loan, it could be cash, it could guarantees but you know that we've made it clear we are not going fund operational losses."
Kruger Inc. has said it has lost money at Corner Brook Pulp and Paper for several years, and that employee support is necessary to restore financial order. Chairman Joseph Kruger described the situation as a "very fragile" state in a letter sent to workers last week.
Kruger, who met with Premier Kathy Dunderdale earlier this month, warned workers "we have now reached a point where we will not be able to refinance the company" unless it secured employee support for its restructuring plan.
As well, he said if the pension restructuring plan is approved, "We will have to submit a sustainability plan to our lenders, demonstrating that the mill can be viable in the future."
Marshall said government would like to see financial support be used to upgrade the mill.
"A framework has been put into place and we will offer, you know, support to the company to enable them to hopefully be viable, sustainable and thrive in the future," Marshall said.