Fortress Paper Ltd. announced recently that it has commenced dissolving pulp production at its Fortress Specialty Cellulose Mill in Thurso, Quebec. The centerpiece of the project, a new state of the art pre-hydrolized kraft cooking plant, recently came on line successfully. The commencement of dissolving pulp production signifies the successful completion of the conversion of the Fortress Specialty Cellulose Mill into a dissolving pulp operation.

Chad Wasilenkoff, Chairman and Chief Executive Officer of Fortress Paper, commented: "This is a momentous day in the history of Fortress Paper and a culmination of our work at the Fortress Specialty Cellulose Mill since acquiring the mill in April 2010. We are very proud to join the limited group of dissolving pulp producers in the world and look forward to completing our first shipments. We would like to thank all those involved in helping bring this project on line."

Fortress Paper is an international producer of security and other specialty papers and products. Fortress operates three mills, the Landqart Mill located in Switzerland, the Dresden Mill located in Germany and the Fortress Specialty Cellulose Mill located in Quebec, Canada. Fortress Paper's security papers include banknote, passport and visa papers and its specialty papers include non-woven wallpaper base products, and graphic and technical papers. Fortress Paper's pulp business includes dissolving pulp produced at the Fortress Specialty Cellulose Mill.

Tembec Sells Elko and Canal Flats Mills

Canfor buys two mills for $60 million; Tembec keeps Skookumchuk mill

The two largest sawmills in the East Kootenay have been sold.

Tembec announced recently that it has sold its Elko and Canal Flats sawmills, and the associated 1.1 million cubic metres of lumber and cutting rights, to Canfor Corporation for $60 million.

Canfor already owns the sawmill in Radium Hot Springs, which has been shut down since June 2009.

About 455 employees are included in the transaction. The Elko and Canal Flats sawmills employ some 165 people on each site. The remaining employees include 33 forest management workers and roughly 90 staff located in Cranbrook head office and associated Tembec field sites.

"All employees will move forward with the company - that's the intent," said Dennis Rounsville, Tembec's executive vice president based out of the Cranbrook office.

Tembec's regional headquarters in Cranbrook's historic Central School building will become Canfor's new lumber office, according to Rounsville.

"This office you see in Cranbrook is the lumber office. Canfor will reside in this office. They will keep the same administration and forestry staff," said Rounsville.

Tembec will continue to own and operate the Skookumchuck pulp mill that employs 280 people, and Canfor will provide fibre for the Tembec pulp mill.

"We will come up with an agreement to make sure there is chips and bark for the Skookumchuck pulp mill. That will be part of this transaction, that we have to have a long-term agreement for that," said Rounsville.

What's more, Tembec will retain the private land it owns in the Elk Valley, according to Rounsville.

"We will retain our access to the private lands we own, and we will have an agreement with them for the harvesting of those lands. That's significant in the Elk Valley. We do own a lot of land up there."

Tembec acquired the Elko and Canal Flats sawmills in 1999 as part of the acquisition of Crestbrook Forest Industries.

Canfor plans to make capital investments in excess of $50 million to enhance productivity and cost performance in its Southern Interior sawmills, according to a press release.

The sale is expected to be finalized in the first quarter of 2012 and is subject to regulatory and customary closing conditions.

MWV to Spin Off Consumer & Office Products Business and Merge it with ACCO Brands

MeadWestvaco Corporation (NYSE: MWV), a global leader in packaging, recently announced that the company will spin off its Consumer & Office Products business and has signed a definitive agreement to merge the business into ACCO Brands Corporation (NYSE: ABD), one of the world’s largest office supply manufacturers. The tax-efficient transaction is valued at approximately $860 million to MWV and its shareholders on a pre-synergy basis.

MWV Consumer & Office Products is a leading manufacturer and marketer of school supplies, office products, and planning and organizing tools – including the Mead®, Five Star®, At-A-Glance® and Tilibra® brands. The business has significant operations in the United States, Canada and Brazil. With the addition of this business, ACCO Brands will add to its existing portfolio of top-brands – creating a global school and office products leader. ACCO Brands also will be able to expand its global footprint, including to the attractive market in Brazil, and create additional value through $30 million of estimated annual cost synergies. The transaction will enable MWV to sharpen its focus on profitable growth opportunities in large and growing global packaging markets, including food, beverage, healthcare, personal care, tobacco and home and garden.

“This is a transaction that will strengthen the market leadership positions of MWV and ACCO, and creates substantial value for both companies’ shareholders,” said John A. Luke, Jr., chairman and chief executive officer. “With our Consumer & Office Products business, ACCO will have a stronger presence in the global marketplace for branded school and office products. And, at the same time, we are taking a significant step in transforming MWV’s business to focus on and grow in our targeted global packaging markets.”

The transaction has several benefits for MWV and its shareholders:

· Improves MWV’s overall growth profile and focus on packaging;

· Provides resources to continue to invest in MWV’s core businesses;

· Optimizes value for MWV shareholders through a tax-efficient Reverse Morris Trust structure; and

· Creates a larger and stronger ACCO Brands in which MWV shareholders will have majority ownership.

MWV expects the separation to occur through a “spin-merge” transaction in which the MWV Consumer & Office Products operations will be spun off in a new entity and then that entity will be immediately merged into ACCO Brands. At closing, MWV shareholders will receive 50.5 percent of the shares of ACCO Brands stock and MWV will receive $460 million of cash. In total, this transaction represents an aggregate value of approximately $860 million (pre-synergies) to MWV and its shareholders (based on ACCO Brands’ closing stock price of $6.96 on November 16, 2011). MWV shareholders will receive approximately one share of ACCO Brands for every three shares of MWV held as of the record date.

The transaction is expected to be completed in the first half of 2012. ACCO Brands has obtained committed financing to effect the transaction. The transaction is subject to approval by ACCO Brands’ shareholders and the satisfaction of customary closing conditions and regulatory approvals, including a favorable ruling from the U.S. Internal Revenue Service. The combined business will be managed by ACCO Brands’ executive team and board of directors. MWV will select two directors to join ACCO Brands’ board at the closing of the transaction. ACCO Brands’ headquarters will remain in Lincolnshire, Illinois.

Goldman, Sachs & Co. advised MWV on the transaction. Greenhill & Co. LLC provided an independent fairness opinion to the company’s board of directors. Wachtell, Lipton, Rosen & Katz provided legal counsel.

Boise Completes Hexacomb Acquisition

Boise Inc. (NYSE: BZ) recently announced that it had completed the acquisition of the Hexacomb protective packaging business of Pregis Corporation. Hexacomb is a leader in kraft-paper-based honeycomb protective packaging and operates twelve manufacturing facilities across six countries.

"We are pleased to complete this acquisition and welcome Hexacomb employees to Boise,” said

Alexander Toeldte, president and chief executive officer of Boise Inc. “Hexacomb expands our position in the protective packaging market, provides a platform for further growth, steps up our vertical integration within our containerboard business, and delivers synergies with limited execution risk.”

In 2010, Hexacomb had revenues of $102 million and converted approximately 60,000 tons of

containerboard. The $125 million transaction was financed through cash on hand.

Boise recently reported net income of $28.4 million for third quarter 2011, compared with net income of $35.9 million for third quarter 2010. EBITDA was $98.5 million for third quarter 2011, compared with $109.8 million for third quarter 2010.

Metso Buys Filtration Component Maker Fabco

Metso has acquired Fabco Inc (Fabrication Company of Maine), a US manufacturer and servicer of filtration components for the pulp and paper industry.

Located in Winthrop, Maine and employing 20 people, Fabco offers filtration solutions for a paper mill’s woodyard, pulp mill, paper machine and wastewater treatment.

The Fabco product range includes disc filter sectors, drum filter covers, belt press belts, sector covers, vibrating and polishing filter screens and recausticizing products.

Fabco will be affiliated to the Metso Paper and Fiber Technology segment - Filtration Services.

International Paper Announces Definitive Agreement to Acquire Temple-Inland

International Paper (NYSE: IP) and Temple-Inland Inc. (NYSE: TIN) recently announced that they have entered into a definitive merger agreement under which International Paper will acquire all of the outstanding common stock of Temple-Inland for $32.00 per share in cash, plus the assumption of $600 million in Temple-Inland's year end debt. The total transaction value is approximately $4.3 billion.

The combination, which has been approved by the Boards of both companies, brings together two strong North American corrugated packaging businesses to create an even stronger company. The transaction is expected to be accretive to International Paper's shareholders in year one after closing. It is expected to close in the first quarter of 2012.

International Paper Chairman and CEO John Faraci said, "The strategic benefits of this combination are clear and we are pleased to be able to move forward on terms that are financially attractive for both sets of shareholders. Acquiring Temple-Inland enhances our ability to generate additional cash flow while maintaining our strong balance sheet. We look forward to working with the employees of Temple-Inland as we integrate our businesses and create an even stronger company with substantial benefits for our customers, employees and shareholders."

Temple-Inland Chairman and Chief Executive Officer Doyle R. Simons said, "This transaction creates value for both Temple-Inland and International Paper shareholders. The combined company will be positioned to be a leader in providing high quality products for its customers."

The combination is expected to yield synergies of approximately $300 million annually within 24 months of closing, derived primarily from the areas of operations, freight, logistics, selling expense and overhead. The companies have a shared focus on low-cost mills, complementary converting systems and high levels of box integration - Temple-Inland's products and manufacturing facilities are an excellent strategic fit with International Paper's current offerings and facilities.

Evercore Partners and UBS Investment Bank served as financial advisors to International Paper and Goldman, Sachs & Co. served as financial advisor to Temple-Inland. Debevoise & Plimpton LLP served as International Paper's legal counsel and Temple-Inland was advised by Wachtell, Lipton, Rosen & Katz.

International Paper (NYSE: IP) is a global paper and packaging company with manufacturing operations in North America, Europe, Latin America, Russia, Asia and North Africa. Its businesses include uncoated papers and industrial and consumer packaging, complemented by xpedx, the Company's North American distribution company. Headquartered in Memphis, Tennessee, the company employs about 59,500 people in more than 24 countries and serves customers worldwide. 2010 net sales were more than $25 billion. For more information about International Paper, its products and stewardship efforts, visit internationalpaper.com.

Temple-Inland Inc. is a manufacturing company focused on corrugated packaging and building products. The fully integrated corrugated packaging operation consists of 7 mills and 59 converting facilities. The building products operation manufactures a diverse line of building products for new home construction, commercial and repair and remodeling markets. Temple-Inland's address on the World Wide Web is www.templeinland.com.

Sappi to Convert Kraft Pulp Mill to Chemical Cellulose

Sappi has declared the approval of a capital project worth $170 million for the conversion of the kraft pulp mill located in Cloquet, Minnesota into a chemical cellulose production facility.

The proposed conversion project is scheduled to start in 2013. After the completion of the project, nearly 330,000 Mt of chemical cellulose will be produced annually. Approved capital plans also require a $ 13 million project to improve the coated paper production line at the Sappi Somerset Mill located in Skowhegan, Maine.

Sappi’s latest investments are based on its confidence that North America can be a major market for chemical cellulose, supporting its position in fine and release papers. The company’s Saiccor Mill located in KwaZulu-Natal, South Africa is already the largest producer of chemical cellulose in the world. The previously declared expansion project at the Sappi Ngodwana Mill situated in South Africa along with the latest Cloquet project will increase overall chemical cellulose production capacity of Sappi to more than 1.3 million Mt annually.

The coated paper business of the company at the Cloquet facility will not be affected by the conversion project. Product quality will remain unaffected across all grades, as approval is granted for dry fiber handling systems and for capability enhancements of paper machines as part of the capital project.

At present, the pulp mill in Cloquet, manufactures hardwood kraft pulp. Sappi will ensure a smooth conversion by supplying the kraft pulp from its Somerset Mill in order to meet the demand of its pulp customers.

Brazil’s Fibria Concludes Strategic Repositioning, Focusing on Core Business of Pulp

The third quarter of 2011 was marked the conclusion of Fibria’s strategic repositioning exclusively in the core business of pulp and the forestry base. Despite macroeconomic challenges with the real’s depreciation against the dollar, the Company’s stable pulp production and sales in the period demonstrate the strength of the Company’s decision. The sale of its last paper asset, the Piracicaba Unit, to OJI Paper helped maintain the Company’s cash and liquidity position.

Fibria’s pulp sales increased 7% year-on-year and remained stable quarter-on-quarter. The Company’s EBITDA was R$476 million, with a margin of 33%. Net operating revenue totaled R$1.45 billion, stable quarter-on-quarter. Net debt totaled R$9.542 billion, falling 6% year-on-year, while the appreciation of the U.S. dollar drove a 20% quarter-on-quarter increase.

The 19% appreciation of the U.S. dollar against the real in the third quarter had accounting impacts on the Company’s balance sheet but no cash effect, as conversion of the dollar-denominated debt (92% of the total) to reais at the end of September, caused Fibria to post a loss of R$1.1 billion. As more than 90% of its production is exported, most of the Company’s debt is denominated in dollars for a natural hedge.

Due to the adverse macroeconomic scenario, the Company has maintained its focus on the Competitiveness Project with initiatives such as structural optimization, process review and simplification, and debt reduction. A R$201 million reduction in capital investments (CAPEX) for 2011 was approved, bringing CAPEX for the year to R$1.44 billion. The Company has also worked toward increasing liquidity events, with the sale of the Losango forest asset. Other initiatives target reducing investments in working capital.

Praxair to Supply New Uruguayan Pulp Mill

Praxair Uruguay, a subsidiary of Praxair, Inc. (NYSE: PX), has signed a 15-year contract to supply oxygen to a new pulp mill complex being built in Punta Pereira, in the department of Colonia, Uruguay. The new facility will be operated by Montes del Plata, a 50-50 joint venture between Arauco of Chile and StoraEnso of Finland and Sweden.

Praxair will build, own and operate a non-cryogenic vacuum-pressure-swing-adsorption (VPSA) plant with a capacity of 126 tons per day of gaseous oxygen. The plant is scheduled to start up in early 2013.

Used in the pulp bleaching process, oxygen delignification reduces active chlorine requirements, providing significant operating cost advantages and environmental benefits.

“We are pleased to support this strategically important project with Praxair´s second plant in Uruguay, strengthening our presence in the region with a strong partnership with Arauco and StoraEnso,” said Gilney Bastos, business executive director of Praxair’s Brazil-based subsidiary, White Martins Industriais Ltda.

“We have reached a good agreement with Praxair, which will benefit both parties. A state-of-the-art pulp mill needs state-of-the-art suppliers, so we are happy having Praxair as one of our partners in line with our main objective, which is to build the best pulp mill in the world,” said Erwin Kaufmann, general manager of Montes del Plata.

The pulp mill will be the largest-ever privately executed investment in Uruguay. The joint venture is investing $1.9 billion in the construction of a state-of-the-art pulp mill, a power generation unit based on renewable sources and deepwater port facilities. The complex is expected to produce 1.3 million tons of cellulose pulp annually beginning in early 2013. More information is available at www.montesdelplata.com.uy.

ASIA/ EUROPE

China's Import of Wood Chips Grows as Pulp Production Expands

According to a new report from Wood Resources International LLC, Chinese pulp mills increasingly have to rely on imported wood chips for their wood fiber needs. In 2011, record volumes are being imported mainly from hardwood plantations in Vietnam, Thailand and Indonesia. Imported wood chip costs from Vietnam have gone up 40 percent in two years and are closing in on costs for chips shipped to Japan.

With the lack of sufficient quality and quantity of domestic wood fiber supply, new pulp mills in China are looking to expand importation of wood chips from plantation-rich countries in Southeast Asia to meet their growing fiber needs.

In the third quarter of 2011, Vietnam, Thailand and Indonesia were the major suppliers to China, together accounting for about 88 percent of all imports of hardwood chips, as reported in the Wood Resource Quarterly.

Malaysia, Cambodia, Chile and Brazil are few of the recent and still small suppliers of hardwood chips to China. These countries, which all supply wood chips from fast- growing Eucalyptus and Acacia plantations, are likely to expand their shipments in the coming years when Chinese pulp mills continue to diversify their supply sources.

The wood chip imports in the first ten months of 2011 already equal more than the total volume of imports in all of 2010. This year’s imports will reach around seven million tons, or 37 percent higher than in 2010. This upward trend is expected to continue in 2012 and 2013 because the Chinese pulp industry is in an expansion mode.

Pulp mills in China consume practically only hardwood fiber, so imports of softwood chips were negligible up until last year when a few shipments started to enter Chinese ports from Australia, Russia, the US and New Zealand. This year, total softwood imports may reach just above 300,000 tons, or four percent of total chip imports.

The average value for imported wood chips has steadily increased, reaching $180/ton in the 3Q/11, or about 22 percent higher than the same quarter last year, as reported in the Wood Resource Quarterly. Vietnam is the lowest-cost supplier, while the cost for Eucalyptus chips from Australia were at the high-end in the 3Q.

The costs chips imported from the major supplying country Vietnam, have gone up almost 40 percent over the past two years. Vietnam is also shipping large chip volumes to Japanese pulp mills and it is interesting to note how the price discrepancy between chips exported to Japan and China has declined from almost $60/ton premium for Japanese bound chips in 2009 to only $14/ton in the 3Q/11.

ANDRITZ to Upgrade Softwood CTMP Line to Hardwood Pumping Line in China

International technology Group ANDRITZ has been awarded an order by Xinxiang Xinya Group Co., Ltd. (Henan Xinhai Paper Co. Ltd.) to supply key equipment, a new automation system, and services for the upgrade of a softwood CTMP line which was transferred from Canada to China.

Start-up of the new line, reconfigured by ANDRITZ PULP & PAPER to one of China’s biggest hardwood mechanical pulping systems and based on the patented P-RC APMP technology, is scheduled for the end of 2012.

The pulp produced will be used primarily for board grades; however, the line provides also the possibility to produce printing and writing grades in the future. The line capacity is 700 t/d.

Toscotec to Supply Complete Tissue Plant to Romania’s Petrocart

Italian leading paper machinery manufacturer Toscotec will supply a complete tissue production line to the Rumanian Company Petrocart. The tissue line will be installed at Piatra Neamt capital of the Neamt district in the Moldavia historical region. The line will be started up at the beginning of 2013. The project enjoyed a contribution granted by EEC and was assigned to Toscotec after an official tender procedure.

The company, that employees 300 people, is listed on the Bucharest Stock Exchange and the shares are marketed on the RASDAQ market. The main Petrocart shareholder is the Petroact Association.

Petrocart manufactures paper and cardboard for various purposes. In Romania, it is the sole producer of triplex and electro-technical cardboard. The present company's supply consists of four types of products in various ranges: cardboard for transformers, cardboard for electric machines, triplex cardboard and tissue paper.

The tissue paper is produced with heat treated recycled paper. Helga, Salmo and Fana are well-known tissue paper brands produced by Petrocart.

"Green since 1908" is the Petrocart slogan. By its means, the company acknowledges the values of quality, tradition and interest in the environment and the community.

According to this slogan and to this philosophy the new Toscotec project will be focused on reduced energy consumptions, usage of waste paper in the manufacturing process, recovery and re-usage of the process water, low emissions (noise and pollutants) as well as on green energy usage with the application of a cogeneration plant feeding with waste gases the machine hood and the boiler plant.

Toscotec delivery, based on a turn-key concept, includes a virgin pulp stock preparation line, upgrade and implementation of the existing waste paper plant, flotation units for water recovery technology, a MODULO Plus tissue machine with single-layer headbox, double press configuration and Toscotec steel Yankee cylinder TT SYD 12FT. The supply will also comprise an extensive electrificationptc and controls package, tissue machine auxiliaries like hood, steam & condensate system, vacuum system and additional plants. A three unwind stands Toscotec rewinder TT WIND-M will complete the package.

With a width of 2,85m and a design speed of 1,500 m/min, the new production line will produce 75 tons a day of high-quality toilet and towel grades.

Toscotec is one of the market leaders for medium-sized tissue machines with numerous installations worldwide. With this latest order the company can claim, among these projects, seven references in Europe since 2009.

McIlvaine Company

Northfield, IL 60093-2743

Tel: 847-784-0012 Fax: 847-784-0061

E-mail: editor@mcilvainecompany.com

Web site: www.mcilvainecompany.com