6 INDUSTRY NEWS


Pulp Paper & Logistics


Asset strippers move into the closed Aylesford Newsprint site


Newsprint in the UK – with the loss of 230 jobs, could result in creditors missing out on up to £80 million. Administrators KPMG were


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called in at the end of February, and following the closure announcement redundancy notices were immediately issued to staff. Moves to sell assets were almost as fast as the decline of the company, which was suffering in the UK from overcapacity and high energy costs. By the middle of April, vehicles and equipment used at the plant, which had capacity to produce 400,000 tonnes of newsprint a year, were being removed for auction in May. It is understood that unsecured creditors, owed more than


he financial collapse of one of Europe’s biggest newsprint mills – Aylesford


£120m, will only receive about £40m. The sale of the 100-acre site could realise £30m while more than £13m could be raised from equipment, carbon credits and receivable sales. Administrator Allan Graham


at KPMG, told local media: “Significant overcapacity in the newsprint market, coupled with rise of digital media, has created challenging operating conditions for Aylesford Newsprint, which was unable to be maintained as a going concern.” Losses were being made


at Aylesford Newsprint for a number of years, as it fought to stay afloat while demand for newsprint declined. The general manager at


the nearby Kemsley mill in Sittingbourne, Kent, suggests that converting the line at Aylesford to make packaging paper might have saved it. But the mill, which was bought by private equity firm Martland


Holdings from joint owners SCA and Mondi in 2012, didn’t have the funds. “The long-term survivors in


the paper industry will likely be those who have the best energy solutions,” said Craig Nichol at the Kemsley mill, which makes packaging papers and is owned by D S Smith, when talking to Kent Business. “We are an energy-intensive industry so being efficient in generation and consumption is vital. “Less and less people are buying newspapers as they turn to social media and phones to access information. “There has been a decline in


consumption of newsprint and an increase in capacity. It is a terrible situation to find yourself in. “The recent investment by


Palm Paper in Norfolk, with a large machine, has made it a tough market. By comparison, packaging grows in line with


Tullis Russell Papermakers goes into administration


UK-based Tullis Russell Papermakers Ltd, a subsidiary of the Tullis Russell Group, has been put into administration by its directors. The move is a result of falling


demand for papermakers’ products while wood pulp, the main raw material, has become


May/June 2015


more expensive at a time when currency exchange rates are unfavourable. Attempts were made to find


buyers for the company, but were unsuccessful. Employee-owned Tullis Russell


Group’s two other operating subsidiaries, Tullis Russell


Security & Speciality Coating based in Bollington, Cheshire, and Tullis Russell Image Transfer based in Ansan, South Korea, are unaffected. Tullis Russell Papermakers was


founded in 1809 at Markinch in Scotland, and more recently has manufactured high quality board


GDP. Lots of people order things over the internet now which comes in boxes.” Hope that the Aylesford mill


might have survived came when rival UPM at Liverpool shut down its newsprint machine in November 2014 with the loss of more than 120 jobs. Formerly known as Aylesford


Paper Mills, the site had been making paper since 1922. Aylesford Newsprint was created in 1993 as a joint venture between SCA and Mondi. More recently it made a 100 per cent recycled product using paper from the largest paper recycling factory in Europe.


The mill operated two papermaking lines, a Valmet line installed 20 years ago, and a Beloitte Walmsley line. These and ancillary equipment were due to be sold by private treaty by LSH Machinery & Business Assets by the end of May.


for use in the cards, covers and premium packaging sectors. Cost cutting exercises have


been introduced, such as the installation of a biomass power plant that reduced energy costs by half. “Despite these efforts,


there remains over supply in the global paper market and demand continues to fall,” said group chief executive Chris Parr. “It has become clear to the board that Papermakers is no longer a viable business.”


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