Union officials content with Georgia-Pacific buyout of Fort James

WESTPORT - Union officials representing workers at Fort James Corp. paper mill are expressing some excitement about the announced $7.7 billion acquisition of the company by Georgia-Pacific Corp.

"Since this will make us the largest tissue producer in the world, business will continue to prosper at the Wauna mill," said Larry Reandeau, president of Paper, Allied-Industrial, Chemical and Energy (PACE) Local 8-1097, which represents some 900 hourly workers at the mill in Oregon's Clatsop County. "I look forward to working for Georgia-Pacific, as they have a good reputation in labor relations and have been in the paper industry and in the Northwest for a long time."

Fort James Corp. also operates mills in Halsey, Ore., and Camas, Wash. Halsey millworkers are represented by PACE while the Camas millworkers are members of the Association of Western Pulp and Paper Workers, an affiliate of the Carpenters Union. "Our most recent contract calls for any company that might acquire the mill to also buy our labor contract, which is good to 2005," Bob Cochran, president of AWPPW Local 5 in Camas, told the Vancouver Columbian newspaper. "We hope this is a positive thing for us. Georgia-Pacific has an outstanding corporate record."

Reandeau said Local 8-1097 is in the first year of a six-year collective bargaining agreement at Wauna.

In announcing the acquisition agreement, the two companies said Georgia-Pacific "is preparing to divest approximately 250,000 tons of tissue manufacturing capacity as well as other selected commodity and non-strategic businesses."

Last week, Kimberly-Clark, the world's largest maker of tissue, said it was considering buying the Fort James plants that are part of the acquisition package. Whether that eventually could mean the Camas, Wauna or Halsey mills was unclear. Mark Lindley, a Fort James corporate spokesman, told the Columbian that "it was not feasible or proper to speculate on what facilities might be impacted" by the divestiture. "It will be several months before the regulatory approval process is even completed," he said.

Cochran said that he was confident about Camas, no matter what happens."We believe the mill is in a good position, it's viable and strategically a good investment," he said. Millworkers at all the plants are familiar with changing companies. Since the mid-1980s the mills have changed owners four times. Fort James, of Deerfield, Ill., was created in 1997 from the merger of the Green Bay, Wis.-based Fort Howard Corp. and Richmond, Va.-based James River Corp. Prior to that it operated as Crown Zellerbach.

Under the agreement, Atlanta-based Georgia-Pacific - which already owns a tissue mill in Bellingham, Wash., - will pay about $37 in cash and stock for each share of Fort James and also will assume about $3.5 billion of Fort James debt.

Fort James has about 25,000 employees at 50 factories in the United States, Canada and Europe and is the No. 1 bathroom tissue producer in North America. It has also developed tree farms in Washington and Oregon for fast-growing cottonwoods or hybrid poplars as a potential source of chip supply for paper mills.

Georgia-Pacific employs about 55,000 people at more than 500 locations in North America. Besides paper products, it also is the nation's largest producer of structural wood panels.

The merger would make Georgia-Pacific the world's largest tissue and paper towel maker, boasting a powerful lineup of well-known products, including Quilted Northern, Soft 'N Gentle, Brawny, Mardi Gras, So-Dri, Vanity Fair, Dixie, Angel Soft and Sparkle.

August 4, 2000 issue

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