Company looks to close on Eastern deal

BANGOR – First Paper Holding LLC would like to close its deal to purchase Eastern Pulp and Paper Corp. by early next week. But if it cannot wrap it up by Monday, the company wants a little more time.

On Thursday, First Paper Holding filed an amendment to its April 30 asset purchase agreement in U.S. Bankruptcy Court in Portland. The buyer wants to extend the deal’s closing date from “May 24 at the latest,” as written in the original agreement, to the new date of May 31.

“We probably won’t know the day we close until that day,” John Wissmann, one of the First Paper partners purchasing Eastern Pulp, said Thursday. “I think everything is falling into place. We’re starting to feel good about this.”

First Paper Holding is owned by Wissmann, who is a strategic consultant with Fisher International of South Norwalk, Conn.; Rodney Fisher, owner of Fisher International; and Keith Van Scotter of Tacoma, Wash., a former Fraser Paper mill manager in Madawaska; and other investors.

The company will reopen Eastern Pulp’s Lincoln mill and rename it Lincoln Paper and Tissue Co. About 360 workers will be hired. Eastern’s Brewer mill, Eastern Fine Paper Co., likely will be given to the city of Brewer.

First Paper intended to close on Wednesday, but that was pushed to today or Monday after a contentious discussion late last week with the Finance Authority of Maine over conditions FAME wanted to place on a $5.5 million financing package. FAME, which later agreed to mediate the differences with First Paper, still has not released the funding package, but that could come at any time.

John Witherspoon, FAME chief executive officer, and David Cyr, a senior risk manager, said during a conference call Thursday “there’s nothing controversial” about the lending agency’s discussions with First Paper.

“Everything seems to be progressing,” Cyr said.

Wissmann said the primary reason the deal may not be closed by Monday is because volumes of documents need to be reviewed by attorneys for creditors and lenders before they are signed.

Also, an agreement with the state Department of Environmental Protection on financial exposure regarding historic contamination on the sites needs to be made final, Wissmann said.

First Paper is carving out – or not buying – some property north of Eastern Pulp’s Lincoln mill because of environmental hazards, he said.

“Just about everything [not being purchased] is in the north 20 percent of the property,” Wissmann said.

First Paper and DEP are discussing what to do with bark that had been stored all over the mill site. Wissmann said DEP would like First Paper to cap or cover the bark, but First Paper is hesitant because the project would cost $2 million.

“We’d rather not take on that liability,” he said. “So we’re going to leave it behind, and we’re leaving open the option to buy it.”

If the deal is closed early next week, First Paper will begin making tissue at the Lincoln mill within a week. A skeleton crew already is on the site preparing the mill for reopening, Wissmann said, and other employees will return to work within days of the deal being completed.

“We have just about everything ready to go,” he said.