Lincoln Paper mill attracting orders under new owners

BANGOR – In a progress report to members of Bangor’s business community Friday, the president of Lincoln Paper and Tissue Co. expressed relief that his $23.7 million purchase of abandoned Eastern Pulp and Paper Co. was over and that back orders for the specialty tissue products were on the books.

Last May, Keith Van Scotter and First Paper Holding Co. completed its purchase of bankrupt Eastern Pulp and its two abandoned mills in Brewer and Lincoln in less than three months.

For anyone to purchase an abandoned company through bankruptcy proceedings is considered a rarity. Usually the business is left shuttered for creditors to pick apart.

The sale was closed at 4:15 p.m. on May 28. On June 3, the tissue mill in Lincoln was restarted and 80 percent of the operations were running by June 15.

“It’s still amazing to me,” said Van Scotter about the quick turnaround from closing the sale to restarting the mill that had been shut down for almost six months. “I don’t know if anybody keeps records on these things, but I think that was a record. I didn’t do it. I helped plan it. It’s a tribute to the people in Lincoln.”

Van Scotter spoke to the 50-member Action Committee during a meeting at the Dyke Center for Family Business at Husson College.

The Brewer mill was not restarted because it was viewed as too costly to operate, but was sold to the city of Brewer. About 360 of the 750 people who had worked at both mills under the previous owners were hired by Lincoln Paper and Tissue.

Although Van Scotter acknowledged that during the sales process he got pains in his stomach while thinking about whether he could line up customers and not run out of working capital, operations at the mill for the most part have been running according to plans. Some equipment has broken down and the 360 employees are trying to get used to a new way of doing business, he said, but the outlook is good.

“We’re actually getting customers the previous owners didn’t have,” Van Scotter said. “I’ve been told that Lincoln is the best.”

Lincoln Paper and Tissue makes deep-dyed specialty napkins, magazine reply cards, uncoated free sheet paper and pulp. Only one other company competes with the Lincoln mill on specialty napkin production, Van Scotter said.

Lincoln Paper and Tissue still faces challenges. The company wants to experience fewer equipment breakdowns, reduce costs more than it already has, and build relationships with suppliers who may have been financially burned by the previous owners, Van Scotter said.

Next week, the owners will start discussions with unnamed financing companies or paper producers that might be interested in investing in a new tissue machine at the mill, Van Scotter said. But its construction won’t occur in the near term.

Today, Van Scotter and First Paper Holding is planning a barbecue for its workers and will acknowledge them for their efforts to get the company opened.

On Monday, Lincoln Paper and Tissue will receive the “Economic Development Project of the Year” award from the Northeastern Economic Development Association in Boston. NEDA is an organization of economic developers in 13 states and the District of Columbia.

Eastern Maine Development Corp. nominated Lincoln Paper and Tissue for the award, said EMDC Executive Director Jonathan Daniels.