Catalyst Paper Corp. announced Thursday that it has entered an agreement to purchase the Rumford Paper Co. mill as part of a $74 million deal to buy two mills owned by NewPage Corp.
The Biron mill in Wisconsin also is part of the deal, according to a press release posted on the website of the company based in Richmond, British Columbia.

According to a release from Catalyst, the deal is contingent on the successful completion of a $1.4 billion merger between NewPage and rival coated paper maker Verso Paper Corp., which is expected to be completed before the end of the year. Verso owns two mills in Maine: one in Jay and a smaller one in Bucksport, which it intends to shut down by Dec. 1.

About 800 people work at the Rumford mill, which accounts for 45 percent of the town’s tax revenues, according to Gregory Buccina, chairman of Rumford’s Board of Selectmen. The mill is Rumford’s largest taxpayer.

Buccina has worked at the mill for 38 years as a paper machine operator and said rumors have been flying around the town and mill in recent weeks about the plant’s future.

Buccina had never heard of Catalyst, but said the acquisition could be good for the mill and the town’s future if the company plans to continue to operate the mill and not treat the property as just an investment opportunity. The Rumford mill produces coated paper and pulp, including the glossy stock that is used for the cover of L.L. Bean catalogs.

“Hopefully, Catalyst will give the town some security. We all know that the industry is changing. We were going nowhere with NewPage,” he said.

The acquisition announcement caught Buccina by surprise. He worked the day shift Thursday and no one mentioned anything about the sale to him.

On Oct. 1, Verso announced plans to close its paper mill in Bucksport in December. The company said the closure will reduce Verso’s coated groundwood paper production capacity by 350,000 tons and its specialty paper production capacity by 55,000 tons.

Verso President and Chief Executive Officer Dave Paterson attributed the closure to the Bucksport mill’s lack of profitability in recent years. Verso’s decision means that more than 500 mill employees will out of a job after Dec. 1.

The merger negotiations between NewPage and Verso have involved multiple debt arrangements and the merger is awaiting approval from the U.S. Department of Justice, which is reviewing the proposal because of antitrust concerns. If approved, the merger between Ohio-based NewPage and Tennessee-based Verso would give one company control of more than half of the U.S. market for glossy paper.

Calls made late Thursday to NewPage officials seeking comment were not returned.

“With this transaction, Catalyst will be better able to serve new and existing customers through operational synergies and a more diversified and higher value suite of products,” Joe Nemeth, Catalyst’s president and CEO, said in a statement on the company’s website. “Our acquisition of these U.S. pulp and paper mills, once complete, will support our efforts to improve our balance sheet and enhance the company’s long-term competitiveness.”

The acquisition is expected to increase Catalyst’s production capacity by 65 percent or about 995,000 tons per year. Catalyst’s website says it manufactures specialty printing papers, newsprint and pulp for retailers, publishers and commercial printers.

“I think the news about this sale will calm the waters,” Buccina said. “It shows our Rumford employees that we get to see another day, but we all know that day could change suddenly.”

With the impending shutdown of the mill in Bucksport, the state’s pulp and paper industry will have lost three mills in a single year. Old Town Fuel & Fiber in Old Town and the Great Northern Paper mill in East Millinocket closed in 2014.