The Skeena Sawmills sawmill and sister pellet plant, both closed and under receivership, are officially for sale as a package.
Initial offers to the receiver appointed in September by the B.C. Supreme Court are welcome up until Dec. 8 followed by a deadline of Jan. 12 to submit a final bid.
Receiver Alvarez and Marsal says it wants a purchase contract and sale wrapped up by Feb. 2 with court approval by Feb. 16 and a closing date on or around Feb. 29. The closing date could vary depending upon regulatory approvals.
The package consists of the assets of three companies — ROC Holdings which owns the property on which the sawmill belonging to Skeena Sawmills Ltd. sits and the pellet plant belonging to Skeena Bioenergy Ltd. sits.
In a court filing, Alvarez and Marsal said assets include the sawmill which has the capacity to produce 80 million board feet of lumber a year plus lumber, chips and sawdust, logs, five pieces of property, tools and equipment, the right to cut nearly 320,000 cubic feet of trees through various provincial licences and permits. It also includes the pellet plant which has the capacity to produce up to 90,000 tonnes of product per year.
While the Oct. 25, 2023 filing cites “weak international lumber markets” as the reason the sawmill shut down in July 2023, it also listed significant debts on the part of the sawmill and pellet plant.
By far the largest secured creditor at nearly $110 million is a numbered company controlled by the same people who own ROC Holdings, Skeena Sawmills and Skeena Bioenergy.
Using corporate records, Alvarez and Marsal say combined liabilities as of mid-October stand at $161.5 million.
That figure includes outstanding property taxes owed to the City of Terrace of $1.8 million.
The city was ready to place the properties on sale on Sept. 25 for the back taxes, but was prevented from doing so when the B.C. Supreme Court provided the receivership order on Sept. 20.
At the time of the sawmill closure, it employed 102 people with 76 of that total being members of the United Steelworkers Local 1-1937.
And because the pellet plant relied on the sawmill for waste and chips, it also closed in July, affecting another 27 people.
Ten former employees are now engaged as contractors at the mill and pellet plant location in assisting the receiver and providing a security presence as well as winterizing machinery.
Although the receiver is listing everything as a package, it does say it will accept offers for one or more assets individually.
“Accordingly, depending on the offers received, it may be that certain assets are sold sooner ….,” Alvarez and Marsal stated in the filing.
“Morever, depending upon regulatory and other issues, it may be that the completion of an en bloc sale, or the sale of certain assets, will take longer than set out above.
“The receiver’s intention is to ensure that it can adapt the process to the circumstances as necessary as they arise.”