Profile of Bowater
55 East Camperdown Way
PO Box 1028
Greenville SC 29601
Bowater produces newsprint, coated and uncoated groundwood papers including directory papers, bleached kraft pulp, and lumber products. The company is one of the world's largest recyclers of old newspapers and magazines. Bowater has sales offices located throughout North America and in Brazil, England, Japan, Singapore and South Korea.
Bowater acquired Canadian pulp and paper company Avenor for $2.4 billion in 1998, and then sold Avenor's Dryden white paper mill and related assets for $532.5 million.
In 1998, Bowater acquired a South Korean newsprint mill located in the Daebul Industrial Complex on the southwest coast of South Korea.
In 1999, Bowater sold its Great Northern Paper subsidiary to Inexcon Maine, Inc. for $250 million. GNP operates pulp and paper mills in Millinocket and East Millinocket, Maine, and owns approximately 400,000 acres of timberlands and an extensive hydroelectric system.
At December 31, 1998, Bowater owned or leased 2.4 million acres of timberlands in the United States and Canada and has over over 14 million acres of timber cutting rights in Canada, including 900,000 acres in the southeastern United States, 8.3 million acres in Ontario, 4.9 million acres in Quebec, 1.3 million acres in New Brunswick and 600,000 acres in Nova Scotia.
Bowater has been selling timberlands in the past several years: In 1996, the company sold 121,000 acres of timberlands, primarily in Alabama, South Carolina and Maine, for $122 million. In 1997, Bowater sold 1,000 acres of timberlands, primarily in North and South Carolina for $1.3 million. In 1998, the company sold 26,000 acres of timberlands primarily in South Carolina for gross proceeds of $30.9 million. In 1998-99, Bowater sold 1,600,000 acres of timberlands and a sawmill in Maine, for $370 million. In 1999, Bowater's Calhoun Newsprint Company agreed to sell 133,000 acres of timberlands in North and South Carolina to Wachovia Timberland Investment Management, a business unit of Wachovia Bank, N.A., for $163 million.
Consumption of wood
In 1998, the Company consumed 10.3 million tons of wood for pulp, paper and lumber production. Of this amount, 4.3 million tons of wood were harvested from Company-owned or leased properties, while 6.0 million tons were purchased, primarily under contract, from local wood producers, private landowners and sawmills (in the form of residual chips) at market prices. In addition, the Company harvested 2.5 million tons of wood from Company-owned or leased properties to sell to other sawmills and paper companies.
Bowater has 10 pulp and paper mills and three sawmills in the United States, Canada and South Korea.
Newsprint & Directory Division: operates nine manufacturing sites in the United States, Canada and South Korea. The principal product line at these sites is newsprint, but the sites also produce directory paper, market pulp, coated groundwood paper and uncoated groundwood specialties. The Division is responsible for the worldwide marketing and sales of newsprint, directory paper and uncoated groundwood specialties and the operation of its designated manufacturing sites.
Coated Paper Division: operates one site in Catawba, South Carolina, which produces coated groundwood paper, newsprint, market pulp and uncoated groundwood specialties. This Division is responsible for the marketing and sales of coated groundwood paper and the operation of the Catawba site.
Pulp Division: markets and distributes market pulp produced at the Calhoun, Tennessee, Catawba, South Carolina, and Thunder Bay, Ontario, sites. The acquisition of Avenor in July significantly increased Bowater's position in North American pulp production, prompting the creation of a new Pulp Division to manage the worldwide marketing of Bowater's market pulp products.
Recycling: The Company has focused its efforts in recent years on meeting the demand for recycled-content paper products, providing an environmental benefit in reducing solid waste landfill deposits. In addition, this effort allows publishers and other customers to meet recycled-content standards. The Company operates recycling plants at its Calhoun, Mokpo, East Millinocket, Gatineau, Ponderay and Thunder Bay Operations. Taking a mixture of old newspapers and old magazines ("recovered paper"), these plants utilize advanced mechanical and chemical processes to manufacture high quality pulp. The recycled fiber pulp is combined with virgin fiber pulp. The resulting products, which include recycled-content newsprint, directory paper, coated groundwood paper and uncoated groundwood specialties, are comparable in quality to paper produced with 100 percent virgin fiber pulp. In 1998, the Company processed 1.2 million short tons of recovered paper.
Lumber: The Company operates three sawmills that produce construction grade lumber. Bowater Lumber Company produced 95.1 million board feet of lumber in 1998. It sells its lumber in the southeastern and mid-western United States. The Bowater Mersey Paper Company Limited Oakhill Sawmill, which produced 36.8 million board feet of lumber in 1998, sells to customers in eastern Canada and the northeastern United States. The Manifor Inc. sawmill, which produced 66.2 million board feet of lumber in 1998, sells mainly to customers in eastern Canada. The Pinkham Lumber Company, which the Company sold in the first quarter of 1999, produced 75.7 million board feet of lumber in 1998. This lumber was sold to customers in eastern Canada and the northeastern United States. The Company distributes lumber by truck and rail.
As of December 31, 1998, Bowater employed 8,300 people, of whom 5,900 were represented by bargaining units.
Tiger Management L.L.C. (Tiger Performance) = Julian H. Robertson, Jr. New York.
FMR (Fidelity Management & Research Company) = Edward C. Johnson 3d and Abigail P. Johnson. Boston.
Royal Trust Company (Royal Bank, RT Capital, RT Investment). Toronto.
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