N.S. says Northern Pulp misrepresented its financial position, mill says otherwise
August 4, 2020 By P&PC Staff
The standoff between Northern Pulp and Nova Scotia continued this week with the province claiming that the mill has misrepresented its finances, and the mill saying the province knew Northern Pulp’s financial situation.
On Jul. 28, The Chronicle Herald published an article outlining the province’s objections to a $50-million loan offered to Northern Pulp by Paper Excellence Canada, the mill’s parent company, and Pacific Harbour North American Resources. The loan comes with a condition that it must be repaid before the $85 million owed to Nova Scotia by Northern Pulp should the mill enter bankruptcy.
Nova Scotia government reps filed affidavits containing their objections this week in court in British Columbia, where Paper Excellence is headquartered.
Northern Pulp has said it’s out of money and that without the loan, it will be unable to safely idle its Nova Scotia–based mill or pay its workers severance.
But the province argues to B.C.’s Supreme Court that in 2018, when Northern Pulp was seeking loan payment deferrals from the province, it had managed to shore up $59.9 million to pay Paper Excellence Canada Holdings Corporation.
Today, the Chronicle Herald published a follow-up article on the situation.
Northern Pulp’s general manager maintains that the province was well aware of the $59.9 million in payments, that the repayments to Paper Excellence Canada did not violate the terms of loans from the province, and that government representatives were present at the meetings of the mill’s board of directors where these payments were discussed.
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