Domtar Corporation of Montreal today announced an agreement to sell its Ariva business in the United States to privately held Central National-Gottesman (CNG) Inc. Ariva’s Canadian operations are not affected by the transaction. The Canadian operations are to be consolidated into Domtar’s pulp and paper division.
Shortly after its signing the transaction with Domtar, CNG then entered into another agreement to sell the U.S. Midwest portion of the Ariva business to The Millcraft Paper Company, a family-run paper merchant based in Cleveland, Ohio. CNG plans to integrate the remaining United States-based Ariva business into its Lindenmeyr Munroe division.
“Our employees’ efforts to adjust to a rapidly changing printing industry are commendable and I am appreciative of their dedication over the years,” stated John Williams, President and CEO of Domtar. “Today’s decision to rationalize and sell the business represents the best alternative for our shareholders and the agreement with Lindenmeyr, a well-established and long-time valued business partner of Domtar, will assure business continuity for customers.”
Ariva has approximately 400 employees in the United States, some of whom will lose their jobs, without exact numbers being disclosed. Headquartered in Covington, Kentucky, Ariva operates from 15 locations in the United States across eight states in the Northeast and Midwest regions.
In mid-2012, PaperlinX, as part of a worldwide restructuring program, sold its United States operations, listed as Spicers Paper Inc. and Kelly Paper Company, to Central National-Gottesman for US$76 million. At the time, CNG already ran 22 Lindenmeyr Munroe paper distribution facilities and stores.
The purchase of Ariva in the United States marks CNG’s sixth acquisition of a paper merchant in the past four years, including five in the U.S. and one overseas. CNG’s sales of pulp and paper exceed $4 billion annually.