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Resolute posts lower Q2 results; to close acquisition by Paper Excellence in first half 2023
August 11, 2022 By Jennifer Ellson
Resolute Forest Products has reported net income of $256 million for the quarter ending June 30, compared to net income of $268 million in the same period last year. Sales were $1,058 million in the quarter, a decrease of $82 million from the year-ago period.
The company attributed the decrease in sales and profit to lower selling prices for wood and lesser shipments as a result of logistics constraints. Resolute faced higher manufacturing costs, mainly related to fibre costs, maintenance, labor and outside service costs and energy prices, as well as higher freight charges.
Acquisition update
On July 6, Resolute and Paper Excellence Group, through the latter’s wholly-owned subsidiary Domtar Corporation, announced that they have entered into an agreement for Paper Excellence Group to acquire all of the outstanding common shares of Resolute stock.
Resolute said it expects the transaction to close in the first half of 2023, following stockholder and regulatory approvals, and satisfaction of other customary closing conditions.
With this addition to its family of companies, the Paper Excellence Group will further build out its portfolio in North America following the successful acquisition of Domtar last year.
“We are excited to welcome Resolute and its employees to the Paper Excellence family. Resolute is an ideal fit for our long-term growth strategy,” said Patrick Loulou, vice chair and chief strategy officer of the Paper Excellence Group.
“It complements our existing pulp, paper and packaging businesses and adds capabilities in lumber and tissue. We have seen firsthand that Resolute prides itself on its great people, strong assets and a culture of excellence going back more than two hundred years.”
Resolute will become a wholly-owned subsidiary of Domtar and continue to operate on a business-as-usual basis under the Resolute name. The Resolute management team will remain in place at the company’s headquarters.
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