KPS sold Blue Ridge Holding Corp., the parent of Blue Ridge Paper Products Inc. to Packaging Holdings, Inc. (an entity wholly owned by Rank Limited) for $338 million, subject to certain adjustments in July 2007. Rank Group Limited, headquartered in New Zealand, is the owner of the Carter Holt Harvey Ltd. group of companies, Evergreen Packaging Inc. (formerly the Beverage Packaging Division of International Paper) and SIG Holding AG (Switzerland). Headquartered in Canton, North Carolina, Blue Ridge Paper Products Inc. (“Blue Ridge”) is a leading integrated manufacturer of liquid packaging, envelope paper and coated bleachboard used in food service packaging. The Company also produces specialty uncoated and extrusion coated papers. The Company conducts operations in six manufacturing facilities located in five states. KPS created Blue Ridge in May of 1999 to acquire a pulp and paper mill in Canton, North Carolina; an extruding plant in Waynesville, North Carolina; and certain assets and businesses from Champion International Corporation. KPS and co-investor GE Capital (a KPS limited partner) owned 55 percent of Blue Ridge’s common stock. The employees of Blue Ridge owned 40 percent of the Company’s common stock through an employee stock ownership plan (ESOP), and the remaining 5 percent was owned by senior executives of the Company.
When KPS created Blue Ridge, the new company had no senior management team, new product pipeline or customers under contract. KPS transformed into Blue Ridge, a thriving independent enterprise. Blue Ridge grew market share across its core packaging product categories, achieved dominant positions with the most important industry customers, introduced industry-leading barrier structure technology, created joint ventures in Latin America and Europe, and modernized its key manufacturing assets. Very important to the success of the investment was the support of the United Steelworkers (“USW”), which worked in partnership with KPS to create Blue Ridge. Commenting on the Blue Ridge transaction, Leo Gerard, International President of the United Steelworkers, said, “As a result of the acquisition of Blue Ridge Paper by Packaging Holdings Incorporated the USW employee-owners, our Union and KPS Capital was a driving force in creating a new and successful company out of assets many industry experts said should close. I congratulate all of those involved on their accomplishment. Through our members’ sacrifices, investment in their futures, hard work, dedication and focus, we have again proven the experts were wrong. The Company’s employee-owners and our USW members are receiving nearly $30 million of cash in their Employee Stock Ownership Plan (ESOP) accounts, a new and improved collective bargaining agreement, and a bright future with Packaging Holdings Incorporated. This is another example of the successful collaboration between Steelworkers and KPS over the past two decades.” www.blueridgepaper.com NEWS ARTICLES: Summer 1999 OHIO EMPLOYEE OWNERSHIP CENTER NEWSLETTER: Owners at Work "Olmsted: The Successful Venture" June 22, 1999 WALL STREET JOURNAL "Buying The Company Allows Paper-Mill Workers Save Jobs" May 14, 1999 KPS and employees announce completion of purchase of Canton System from Champion International May 1999 The PACEsetter, vol.1 no.3 "North Carolina Local Union Members become Mill Owners in ESOP"