Stock Watch – Cascades To Close Swedish Plant

Stock Watch – Cascades coated boxboard plant south of Stockholm will cease operations at the end of June

Cascades, Inc. (TSE:CAS, Mkt cap 636.69M, P/E 72.10, Div/yield 0.04/2.36, EPS 0.09, Shares 93.91M), a Canada-based company specializing in the recovery and manufacturing of green packaging and tissue paper products, has decided to close its Sweden-based unit, the company has announced, citing the unfavorable market environment in Europe as the main reason behind its decision.

The move concerns the Quebec-based company’s Cascades Djupafors subsidiary in Ronneby and comes after signing an agreement with unions.

Stock Watch Cascades coated boxboard plant cease operations end June

Stock Watch – Cascades coated boxboard plant south of Stockholm will cease operations at the end of June.

Commenting on this “difficult decision,” Cascades’ president and chief executive Mario Plourde said it was in response to the tough market conditions across Europe, which have forced the company to restructure its production activities there in order to retain its competitive edge.

Cascades first hinted at the possible closure of the facility in February, when it said it was starting consultations with unions over the plant’s fate given its “difficult financial position.” Plourde explained then that the likely decision to stop production at the factory followed the overhaul of its manufacturing platform in the region.

The coated boxboard plant, located 500 km south of the capital Stockholm on the country’s southern coast, has an annual capacity of 600,000 tons of coated boxboard a year. It will cease operations at the end of June and some customers will be redirected to Cascade’s facility in La Rochette, France. The company has already signed the requisite agreements with these customers to prevent delays in delivery, it said.

Cascades bought the Swedish plant in 1989. The factory has a 130-strong workforce.

Free Portfolio Review – Markets were up in 2013. Are you at risk in 2014? Sprung Investment Management Is Pleased To Offer Qualified Investors A Free Portfolio Review—Without Cost or Obligation. Learn more here>>

The opinions expressed here are ours alone. They are provided for information purposes only and are not tailored to the needs of any particular individual or company, are not an endorsement, recommendation, or sponsorship of any entity or security, and do not constitute investment advice. We strongly recommend that you seek advice from a qualified investment advisor before making any investment decision.

Did you find this helpful? Please share...
  • More

Leave a Reply

Your email address will not be published. Required fields are marked *