Both Arjowiggins Fine Paper (AWFP), which runs the group’s Stoneywood mill in Aberdeen, and Arjowiggins Chartham (AWC), which operates the Chartham mill in Canterbury, are powered by energy supplied by Scottish Power.
Reports published by administrator FRP Advisory show that AWFC alone had accrued a creditors list valued at £21.5m, which includes more than £1.2m owed to Scottish Power. In order to maintain its energy supply at the two mills, the report indicates that administrators are making weekly advanced payments of £225,000 to Scottish Power.
FRP reports dated 6 March were posted for AWFC, AWC and Arjowiggins Sourcing (AWS) – a company established to purchase pulp raw material across the group run by parent company Sequana – while a report for synthetic coated paper manufacturer Arjobex, which traded as Polyart, was dated 1 March.
According to FRP’s figures, AWFP has an estimated deficiency in regards to creditors of £16.1m and a total estimated deficiency of £41.1m. Sister company AWC had accrued £93m in claims from unsecured non-preferential creditors. With £6m to realise, FRP’s estimated deficiency for AWC stands at more than £92m.
Variously, AWC and AWFP were subject to 13 indicative offers or expressions of interest to buy different elements of the businesses. According to the latest information seen by PrintWeek, however, the businesses are now considering three potential offers which may include one from Swedish wood and paper group Lessebo, headed by Norwegian shareholder Terje Haglund.
Not included in the initial announcement concerning the UK administration was AWS, a purchasing entity for pulp for the Sequana mills which does not reportedly employ any staff in the UK. With a turnover as of 2017 standing at more than £132.5m, its estimated deficiency came to just under £77.9m.
The report on Polyart, or Arjobex, is noteworthy not only for its £1.4m debt to trade and expense creditors, but the £75m owed to the Pension Protection Fund, resulting in a deficiency of £75.9m total.
Regarding the administration of the Arjo group’s French sites in Bessé-sur-Braye, Bourray and Château-Thierry, a decision on Lessebo’s purchasing offer, which attained the approval of the mills’ employees, was set to be handed down by the Commercial Court of Nanterre yesterday (20 March), though an update was not available at the time of writing, although French newspaper France Bleu reported that "hopes were slim" for employees and a decision would now be known on 26 March.
An announcement on behalf of the employees in France said: "The hearing did not go as planned. Lessebo did not give evidence of the funding expected by the court. The elements provided by our directors for the operational part did not pose any difficulties. Lessebo has an extra few days to be credible to judges and the state."