EVERETT — Union and Kimberly-Clark officials announced Dec. 8 that the company’s paper mill in Everett will close in early 2012 after sales talks with potential buyer Atlas Holdings broke down.
Kimberly-Clark has been in the process of seeking to secure sale of the Everett Mill and Pulp operations since January 2011, said Bob Brand, a spokesman for Kimberly-Clark. K-C has worked extensively with potential buyer candidates and exclusively with Atlas Holdings Inc., a company with extensive experience in the pulp and paper industry, for the past several weeks.
“It’s certainly a disappointing day for us,” he said. “Earlier today, we shared with our employees that Kimberly-Clark and Atlas Holdings have been unable to reach agreement on the proposed sale of the mill and confirmed that we will continue with preparations under way for scale down and closure of the Everett mill.”
News of the apparent failure of the sale hit the community hard. About 750 union employees will lose their jobs.
“This is disappointing news,” Everett Mayor Ray Stephanson said. “Our hope is that both parties will reconsider and try to resurrect negotiations for a purchase and sale agreement before the end of the year. The City of Everett stands ready to do whatever we can to bring both companies back together.”
“The Kimberly Clark Mill and its employees have been an important resource to the community for a number of years,” said Dennis Smith, president and CEO of United Way of Snohomish County. “Their contributions ($2,222,409 since 1998) to United Way have helped to make Snohomish County what it is today. Many of the workers at the mill come from families that have worked there for generations. This is truly a great loss for our community.”
“We are saddened by this development, as a lot of hard work and creativity went into getting the mill ready for a new owner, said John Mohr, Port of Everett executive director. “We hope the parties resume negotiations, and the environmental hurdles can be resolved.”
The Association of Western Pulp and Paper Workers and its affiliated locals 183 and 644 were notified early Dec. 8 that the mill will close in the first part of 2012, said Josh Estes, president of Local 183.
“Last week, Kimberly-Clark announced the mill would most likely be sold to Atlas sometime this week and the ‘closure’ part of the parallel paths would be put aside and the ‘sale’ path would become the focus,” Estes said. “At that time, Atlas began the process of handing out applications with the anticipation that a sale would be final sometime in January with a startup to follow shortly after.”
Estes said Local 183 and 644 have started the process of selecting peer support workers to assist current employees in finding and securing employment and training opportunities that may exist.
“Now our focus has to be the safety of our co-workers and seeing if there is any hope left of getting this place sold at all,” Estes said.
Kimberly-Clark had announced earlier this year that the mill would be closed if a buyer could not be found. In September, it entered into exclusive talks with Atlas. Atlas and the union had agreed to a contract that would have employed about 350 people and granted Atlas a number of major concessions on wages and work issues to help make them successful.
“We are disappointed that we couldn’t reach a sales agreement with Atlas Holdings,” said Dave Faddis, vice president product supply for Kimberly-Clark. “We have worked diligently for nearly a year to find a buyer for the Everett mill but, unfortunately, we were unable to do so. Our focus now is on completing the timely and efficient closure of the mill and doing what we can to help our Everett employees with this difficult transition.”
Kimberly-Clark workers will receive federal Trade Adjustment Assistance, Rep. Rick Larsen, D-Wash., announced Dec. 20. The assistance, including re-employment and job search services, training, health care and income support, will be made available to employees of the Everett plant.
Association of Western Pulp and Paper Workers representative Frank Prochaska also hailed the announcement.
“While this won’t replace good paying jobs in Everett, these benefits will help all these workers transition to other meaningful work and will help our community better weather the impact of this loss to our local economy,” he said. “Many people worked very hard on this petition, and all deserve thanks.”
Kimberly-Clark anticipates the last day of operations for the Everett mill will be by the end of March 2012. Company officials said they will continue working with union leadership to assist employees through the transition.
Eventually the waterfront site will be razed and sold for development, said Bob Brand, a Kimberly-Clark spokesman.
“For the folks on the sales team, this is disappointing news,” Brand said. “We’ve been trying to sell the plant for much of a year and this is not the outcome we had hoped for.”
Brand said he couldn’t discuss details of the negotiations with Atlas but added that a problem that could not be resolved involved environmental issues relating to the area’s East Waterway.
“The mitigation plans in the East Waterway were not sufficient,” he said.
“Today’s news of the plant closure is devastating,” Estes said. “Words cannot describe the disappointment that we feel. Our membership has waited all year long to get word of what their future will hold, and now today when everyone expected to hear positive news they have to hear this. It just makes me sick.“
Kimberly-Clark officials said they will continue working with union leadership to assist employees through the transition.
The mill now owned by Kimberly-Clark was built on Everett’s waterfront in 1931 as Puget Sound Pulp and Timber Co. and helped build the city’s reputation as a prime pulp producing center. It became Soundview Pulp Co. in 1935 and was purchased by Scott Paper in 1951. Scott merged with Kimberly-Clark in 1985.
Since the merger, the company has invested about $300 million in the Everett operation, installing major wastewater treatment systems, adding a new effluent outfall and switching its pulp-making system from one based on chlorine to chlorine dioxide, which is considered more environmentally friendly.
Herald business editor Mike Benbow contributed to this report.
Kurt Batdorf: 425-339-3102, kbatdorf@scbj.com.
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