NewPage Corporation, the largest coated paper manufacturer in North America, announced that its subsidiary, Rumford Paper Company, based in Rumford, Maine, has signed an agreement to sell its cogeneration energy assets to a unit of ReEnergy Holdings LLC, a company which specializes in integrated biomass waste fuel renewable energy. The purchase price for the assets is $61,000,000.
The transaction contemplates a long-term, symbiotic relationship between Rumford and ReEnergy. Following the closing, ReEnergy will operate the acquired assets to provide energy to the Rumford mill in the form of electricity and thermal energy. In turn, Rumford's pulp and papermaking process will supply ReEnergy with the sustainable biomass fuel supply needed to operate the cogeneration assets.
"The transaction represents an opportunity for the Rumford mill to realize value from its green energy assets and to focus on its core business of making high quality paper," said George Martin, president and chief executive officer of NewPage Corporation. "We are looking forward to working closely with ReEnergy in this new endeavor," stated Gerald LeClaire, mill manager, Rumford Operations.
Larry Richardson, chief executive officer of ReEnergy, said: "This exciting, new relationship with the Rumford mill is consistent with our business strategy of owning and managing solid fuel renewable energy facilities. We look forward to providing mission-critical, cost effective electricity and thermal energy to the Rumford mill." Tom Beck, ReEnergy's chief commercial officer added: "This partnership promises to support Maine's vital paper industry, and ReEnergy looks forward to providing green energy to both the Rumford mill and the New England region."
The transaction is subject to regulatory approvals and is expected to close in mid 2011.