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Report On Business Tembec permanently closes pulp mill in Smooth Rock Falls, Ont.

Tembec announced Tuesday the permanent closure of a market pulp mill in Smooth Rock Falls, Ont., affecting 229 employees.

The mill had been indefinitely idled at the end of July.

"After a thorough analysis of the current situation, the company has concluded that a sustainable and secure long-term operation at this site is not possible," Tembec said in a release. A total of 185 unionized employees and 44 management staff will be affected.

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"The vintage and scale of this mill and its manufacturing costs relative to global competition, including the availability of affordable fibre, were all key factors in this decision," said Yvon Pelletier, Tembec executive vice-president and president of the Pulp Group.

"After thoroughly reviewing current and future economic conditions, we have made the difficult decision to permanently close the mill."

Employees are to receive severance pay, counselling and support services. A special charge of $31-million relating to pension, severance and other items will be recorded in the quarter ending Dec. 30.

Tembec is a diversified forest products company. With operations principally in North America and France, the company employs about 9,000 people.



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