Simpson Lumber Co. to sell Tacoma Kraft paper mill for $343M

Simpson Lumber Company officials announced Monday they will sell their Tacoma Kraft pulp and paper mill to RockTenn, a manufacturer of corrugated and consumer packaging based in Norcross, Georgia, that operates facilities in Canada, Mexico, Chile, Argentina, and the United States — including two facilities in Washington state, for approximately $343 million.

The Tacoma pulp and paper mill, located at 801 E. Portland Ave., employs approximately 425 people. Last year, the mill produced 465,000 tons of material on two paper machines and two pulp dryers that made various paper grades including containerboard, specialty kraft paper, and pulp. The Tacoma Kraft mill operates a 55-megawatt green biomass fuel cogeneration facility that was completed in 2009 and sells electricity under a long-term contract. Simpson Lumber Company has invested $415 million in environmental and other capital improvements since purchasing the mill from Champion International in 1985. RockTenn plans to invest $60 million in the mill during the next three years, and has also entered into a seven-year wood chip supply contract with Simpson Lumber Company.

“This is exciting news for Tacoma Kraft employees and the community,” said Simpson Lumber Company President Allan Trinkwald. “Tacoma Kraft will be better positioned as part of RockTenn, a successful fiber-based company that is committed to the long-term success of the mill. I want to thank the dedicated Tacoma Kraft employees for their hard work in the past 28 years. They have made the mill into a strong company in Tacoma and positioned it to be a valuable, strategic asset to RockTenn.”

Simpson Lumber Company headquarters will remain in Tacoma and focus on manufacturing in its core businesses of lumber and solid wood doors.

“The Tacoma Kraft Mill is a great strategic fit for RockTenn,” said RockTenn CEO Steve Voorhees. “Adding a West Coast mill will improve our ability to satisfy West Coast customers and generate significant operating efficiencies across our system.”

The transaction is subject to customary closing conditions and regulatory approvals and it is anticipated that the sale will be completed later this year.