PORT TOWNSEND — Port Townsend Paper Corp. is changing ownership this week with a newly formed holding company purchasing the mill and its assets, it was announced Tuesday.
Crown Paper Group Inc. of Atlanta will close on the sale later this week as it purchases Port Townsend Holdings Inc. in its entirety, which controls Port Townsend Paper Corp. — the mill — and Crown Corrugated, which does business as Crown Packaging and Boxmaster in Vancouver, B.C.
“This is very positive for the mill because the people who are buying us know our business and how they can make it more profitable,” Port Townsend Paper Corp. President Roger Hagan said Tuesday, when the news of a sales agreement having been signed was announced.
“This is good news for the mill and the community because it means we will be here for a very long time.”
Hagan said the new company has no connection with Crown Zellerbach, the company that built the mill in 1928.
The amount of the sale will not be publicly disclosed, Hagan said.
The purchase will not immediately change operations at the facility, which employs about 300 employees and is Jefferson County’s largest private employer.
Hagan said he will stay on as president and there will be no change in personnel in the near future.
While Hagan would not divulge any long-term plans, he said in the short term, the investments will be incremental and will use the existing workforce.
“We will work to improve the safety performance, bring our manufacturing excellence methodology to the operations, build on the performance improvements and customer satisfaction that the employees have already achieved,” said Alan Ulman, a spokesman for the new company, in an email.
He said the company plans to invest capital to ensure that the mill and packaging plants have the right tools to accomplish their mission.
According to a news release, Crown Paper Group has the resources to invest in building businesses over the long term.
It was created by the investment firm Lindsay Goldberg, which manages $10 billion of equity capital, according to its website, and is focused on acquiring businesses and helping to build long-term value.
The sale process took approximately six months to complete, Ulman said.
Port Townsend Holdings Inc. was purchased from GoldenTree Asset Management, a New York-based company that was planning to sell the property as part of its long-term strategy, Hagan said.
“Their goal has been to sell the company at one point,” Hagan said.
“Several months ago, they determined it was a viable time to enter into a process.
“There were several entities that were interested, but this one ultimately prevailed.”
In a public letter, Crown CEO Steve Klinger said, “We look forward to the opportunity to continue and enhance the partnership with community leaders in Port Townsend and Jefferson County for the mutual benefit of the community and Port Townsend Paper for years to come.”
Crown Zellerbach began construction of the mill in 1927 and opened the following year, owning and operating the facility until 1983, when it sold the mill to Haindl Papier GmbH of West Germany, which renamed it Port Townsend Paper Corp., according to a report on www.HistoryLink.org.
The mill property had changed hands twice again prior to this week.
Several of the new company’s executives are now in Port Townsend to determine the mill’s future direction, Hagan said.
“They looked at all aspects of our operation and saw a lot of potential,” Hagan said of the new owners.
“They bring a lot of expertise in how to reshape our business.”
Hagan said the Tuesday announcement was timed to accommodate the deadline of the weekly Port Townsend & Jefferson County Leader and ensure the story appeared simultaneously in that paper and the Peninsula Daily News.
“We want to keep everyone on our side and want to be friends with everybody,” Hagan said.
________
Jefferson County Editor Charlie Bermant can be reached at 360-385-2335 or cbermant@peninsuladailynews.com.
