GORHAM — The Gorham Paper and Tissue mill will undergo more than a name change. Over the next few years, the new owner of White Mountain Paper Company said there will be a major overhaul of the mill to turn it into a modern and efficient operation. An estimated 80 percent of the current footprint will be torn down. Once that effort is complete, Evan Behrens of Behrens Investment Group said the focus will turn to expansion plans.
Behrens, along with Price Howard of Global Management Partners and Scott Griffin of Central National Gottesman, took time recently to talk about the mill and plans for its future.
Behrens said the Gorham mill was brought to his attention by Griffin, whose company has marketed 100 percent of the production of the tissue machine since it was installed in 2012. The two men are friends and Griffin said he thought the mill offered a good investment opportunity. At the time, the mill was owned by Patriarch Partners and the three Zohar collateralized loan funds set up to purchase the mill were in bankruptcy. It was expected that the assets in the funds would be sold off.
Behrens said they started doing due diligence last July and he brought in Howard and his team to help with the assessment. With more than 25 years of experience in project engineering including significant experience in the paper industry, Howard has agreed to serve as CEO of the mill.
“I’m excited to have someone of his history and caliber and skill,” Behrens.
The result of the due diligence left the team with no illusions about the mill’s condition.
Behrens and Howard said they concluded the mill was still operating only because of Yankee ingenuity and the skill of the workforce. As a result, Behrens said his company has budgeted a significant amount of money to modernize the mill.
Going forward, the mill will produce bath tissue and paper and so the footprint of the mill will be reduced to build around the $30 million tissue machine installed in 2013. Howard said they will tear down 800,000 square feet of the current complex. Removing the old buildings will make the mill more efficient — he noted currently the boilers are 2,000 feet away from the tissue machine. The existing 90-year old boilers will be replaced with modern fuel-efficient boilers that Behrens said will also have a positive environmental impact. The electrical system will also be upgraded.
Visitors to the mill will notice one immediate difference. Two weeks before the sale was finalized the No. 9 machine (fondly known as Mr. Nibroc) was permanently taken out of service because it no longer met state safety codes. The machine made towels for the away-from-home market and that product line has been dropped. That reduced the current workforce to 56 hourly and 14 salaried employees.
Work on the mill will get underway as soon as the permits are in place. Howard said the new boilers will have to be designed and installed.
“It’s like a jigsaw puzzle,” he said of the process to modernize the 130-plus year paper mill.
Howard said the tissue machine has eight years of deferred maintenance that will have to be caught up.
“It was very underfunded,” he noted.
The mill will continue to operate throughout the renovation.
Behrens said when the renovation is complete, the mill will be greatly condensed, making it more efficient. Replacing old out-of-date equipment should also make it more environmentally friendly. The result will be a model modern mill in a position to move forward.
“We have a clear sight of where we want to go,” he said.
Griffin said White Mountain Paper’s tissue machine fills a unique niche in the marketplace. It produces parent rolls of tissue that are shipped to outside converting locations and turned into premium retail quality bath tissue, kitchen towels, napkins and facial tissue.
“White Mountain is one of the only independent producers of high quality virgin parent tissue rolls in North America where the mill does not convert the parent roll to finished product. This makes White Mountain Paper Company’s position in the market unique,” he said.
Griffin said the company uses environmentally certified pulp and tissue produced at the mill certified by three organizations, all recognizing sustainable and responsible environmental practices in the forest industry.
“We believe the modernization plans will enhance the level of product quality and service for an already extremely supportive customer base while create new opportunities to ensure that future growth and expansion is possible,” said Griffin, whose company is one of the world's largest distributors of pulp, paper, packaging, tissue, newsprint and plywood.
Behrens said to accommodate future growth his company will look at adding a second tissue machine. He said that step is probably three to five years in the future. He said there are no plans to add converting equipment at Gorham.
All three men said being part of the community is important to the company and said they are thankful for the support they have received. They cited Gov. Chris Sununu, James Key-Wallace of the N.H. Business Finance Authority, N.H. Economic Recruiter Benoit Lamontagne, and Executive Councilor Joe Kenney as well as local officials. They said former N.H. Commissioner of Resources and Economic Development George Bald, who was involved in two earlier sales of the facility, also helped out.
“So far the support we’ve got has been terrific,” he said.
The new owner and his team have also reached to local officials and to the head of Local 75, which represents mill workers.
Behrens said he understands there are a lot of stakeholders and in particular praised the workers for the premium product they have been able to produce because of their skill and dedication. He said he making the mill self-sustaining should reduce the anxiety that exists in the community about its future.
Behrens Investment Group is the sixth owner of the mill in just over 25 years.
In 1995, James River Corporation spun the Berlin and Gorham mills off into a newly formed Crown Vantage Corporation. Four years later, facing bankruptcy, Crown Vantage sold both mills to American Tissue. American Tissue filed for bankruptcy in 2001. Fraser Paper Company purchased the mill and reopened it the following year.
In October 2010, Fraser filed for bankruptcy and in May 2011, Lynn Tilton and Patriarch Partners bought the mill and reopened it in May 2011. Tilton converted one of the boilers to natural gas and installed a $35 million tissue machine in the facility. GPT filed for Chapter 11 bankruptcy in U.S. Bankruptcy Court in Delaware last November with an agreement to sell to Behrens. The sale was approved by the court and finalized just before the end of 2020.
Berlin and Gorham both report unpaid taxes accrued by Gorham Paper and Tissue have been paid in full with interest.