Temiscaming, Quebec, Canada, 07 May 2010
– Tembec today announced that its European subsidiary, Tembec SAS has closed the sale transaction with Paper Excellence B.V. for the acquisition of 100% of the shares of Tembec Saint-Gaudens SAS and Tembec Tarascon SAS, two subsidiaries of Tembec SAS. Paper Excellence B.V. paid EUR 66 million for the shares and assumed EUR 34 million debt of the two European subsidiaries, which operate pulp mills in France.
Total consideration for the transaction is approximately EUR 100 million Euros (CAD 133 million), which remains subject to closing working capital adjustments. As a result of the sale, Tembec will record a gain of approximately CAD 20 million in its financial results for the quarter ending June 2010.
Tembec intends to use the cash proceeds to pay down revolving operating debt and for general corporate purposes.
Tembec is a large, diversified and integrated forest products company and a global leader in sustainable forest management practices. The company’s principal operations are located in Canada and France. Tembec’s common shares are listed on the Toronto Stock Exchange under the symbol TMB and warrants under TMB.WT. Additional information on Tembec is available at www.tembec.com