ANNOUNCEMENT 30 May 2017
The provincial government will support the newsprint producer's pension plans.
NUMBER OF INTERVENTIONS
On May 30, 2017 the government of Newfoundland and Labrador reached a deal with Corner Brook Pulp and Paper Ltd. to support the newsprint company’s two defined benefit pension plans. The province will guarantee a letter of credit from a financial institution. In return, the government will take security interests in the company’s power assets at Deer Lake and Watson’s Brook. A trust will hold the letter of credit for the benefit of pension plan members, with the government and the company’s representatives as co-trustees. The deficits in the two pension plans were currently about Can$65 million (US$50.6 million).
The deal is the latest arrangement with the province to keep operations going at the mill. In 2014, Corner Brook Pulp and Paper borrowed $110 million from the province.