Daishowa may sell Peace River mill

Page 2

Daishowa will sells its financially troubled pulp mill in Peace River under an agreement to be signed between two Japanese companies later this month, a Japanese newspaper reported.

According to un-named sources in a story published by the English-language Daily Yomiuri, the debt-ridden Daishowa Paper Company will sell the mill to a company set up by Marubeni Corporation of Japan and Daishowa in 1969.

Tom Hamaoka, vice-president of Daishowa's Canadian operations, confirmed executives from the two companies have discussed forming a partnership in the Peace River mill.

But Hamaoka called Japanese reports outlining financial details "speculative" and said no final agreements have been reached pertaining to the mill 500 km northwest of Edmonton.

Marubeni and Daishowa have been equal partners in the Cariboo Pulp and Paper Company in Quesnel, B.C. for the last 23 years, Hamaoka said.

The Japanese news reports were distributed to Alberta media by Lubicon activities in Edmonton. The Lubicon are staging an ongoing protest against Daishowa, which holds timber leases to traditional lands at Little Buffalo. The protest includes a boycott of companies using Daishowa paper products.

Lubicon officials said the potential sale of the Peace River mill will not effect their concerns over potential forest harvesting on traditional land.

Rumors of a sale of the Peace River mill have been circulating for several months. According to the Daily Yomiuri, Japanese paper manufacturers have been suffering their worst downturn since the Second World War.

The paper said Daishowa has posted substantial deficits over the last two years

and has worked out a five-year plan to sell off stock and land holdings to reduce its debt.

Daishowa's Peace River mill began operations in February 1991.