Hardwood facility purchased by B.C. investors

August 26, 2015

By: Northern Ontario Business

When True North Hardwood Plywood closed in 2013, 240 people lost their jobs and Cochrane lost one of its biggest economic generators. But a new company is taking its chances on the facility, bringing with it the promise of employment and long-term potential.

Rockshield Plywood Corp., a subsidy of the B.C.-based investment firm Rockshield Capital Corp., acquired the facility in April, investing more than $11 million — a combination of private capital, bank loans, and government grants and loans — in its purchase and the startup of operations.

The mill, now called Rockshield Engineered Wood Products (REWP), will produce aspen core plywood. It started back up in May, creating work for more than 100 employees.

“This is an exciting business, which was purchased at an opportunistic and distressed price with compelling economics,” said Rockshield director Marc Cernovitch in a statement. “A first-rate management team has been assembled to lead REWP and run the operation, as well as identify and evaluate other opportunities in the forestry sector. We look forward to providing the financial and strategic support necessary to see this business through to success.”

The company cited a return of housing starts to normal levels, favourable exchange rates between the Canadian and U.S. dollars, and lower oil prices as benefits to the acquisition. Rockshield said it had also reached a non-binding agreement with area First Nations, and had a good labour agreement in place.

Cochrane Mayor Peter Politis said he’s optimistic that the mill, which has faced troubles in the past, has long-term potential for success.

“I’ve been impressed,” said Politis, who has a background in forestry. “I know this facility inside and out; I know the dynamics it faces, the challenges it faces. We’ve got a great workforce here, so that if the right people get together, they’re going to make a lot of money, and I think, so far, I feel pretty good about what they’re doing.”

Currently operating on one shift, Politis said Rockshield, a spokesperson for which could not be reached, is ramping up to a three-shift basis and could require more than 200 people, which would return the facility as the largest employer in Cochrane.

But the company has been challenged, Politis said, by finding the people it needs to fill those ranks, although some former True North employees have returned.

“They’ve got a good contingent of people that have come back, which is helpful to them, but at the same time, because of all the other opportunities that are here, a lot of those people have moved on to other opportunities,” he said. “So, they’re going to have a workforce of about 50/50, I think: about half the workforce is probably going to be the previous workforce and the other half will be new people they’re training.”

Politis said that, unlike mine employees, whose fly-in, fly-out schedules allow them to commute from anywhere, the more traditional work weeks of the Rockshield employees means many will reside right in Cochrane.

In the past, the mill has been plagued by challenges associated with wood supply, because the various tree parts must be shared by facilities producing different products. But Politis said the company seems to be getting the right agreements in place to secure its share.

Politis believes this latest development could now signal a continued period of growth in the forestry sector.

By: Northern Ontario Business

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