Advertisement

You will be redirected to the page you want to view in  seconds.

Our View: Community must respond to Wausau Paper mill sale

5:51 PM, Jan. 15, 2013  |  Comments
Wausau Paper will sell its mill in Mosinee, pictured here in Feb. 2012, as well as in Rhinelander and Brainerd, Minn.
Wausau Paper will sell its mill in Mosinee, pictured here in Feb. 2012, as well as in Rhinelander and Brainerd, Minn.
  • Filed Under

The announcement Friday that Wausau Paper Corp. will attempt to sell its two mills in Wisconsin and one in Minnesota sent shock waves through the region. The decision had been brewing for some time, but the news made concrete what before had been only an abstract possibility.

In the aftermath of that announcement, the activist hedge fund that owns a large stake in the company sent a letter to local management accusing them of acting in "bad faith" and being unwilling to make the sweeping changes needed to maximize shareholder value.

Starboard Value LLC, which owns 14.8 percent of Wausau Paper's stock, has been aggressively pushing the company to cut its less-profitable branches and focus on the part of the company that makes the most money, namely the production of tissue paper by mills in Kentucky and Ohio. That appears, now, to be essentially the path Wausau Paper is taking.

And while internal struggles between Starboard and other members of the Wausau Paper board of directors are escalating - for example, a spat about new board members Starboard wants elected - for relevant local purposes, the Manhattan-based hedge fund essentially has gotten exactly what it wanted. The mills in Mosinee, Rhinelander and Brainerd, Minn., won't be Wausau Paper mills.

Unspoken, but hanging heavily over the discussion, is the possibility that they won't be operating paper mills at all.

This is a complex, still-developing story. Here are a few key points:

? We expect state and local officials to take a very active role in helping connect potential buyers with the sites. Obviously, the best outcome by far is one where the mills stay open, keeping local workers in place, whether they're working for Wausau Paper or some other company.

Already on Tuesday, Marathon County Economic Development Corp.'s David Eckmann said his organization and the Wisconsin Economic Development Corp. will work to keep the mill open. We expect other leaders, including elected leaders, to take an active role, too, and we invite them to keep local residents informed about their efforts.

? These developments serve as yet another reason that it's vital for our region to have a strong infrastructure of worker retraining programs, technical education and university opportunities available for displaced workers. No layoffs have been announced. But the news of the sales serves as a reminder of how much can change in a relatively short period of time.

? The hard truth is that Starboard Value is very likely correct in its analysis of the direction the company needs to take to maximize its profit. A survey of media reports shows that the fund has followed essentially the same playbook with a number of large companies, and its value has soared. Wausau Paper's stock price rose sharply on last week's news.

Most people who own shares in Wausau Paper probably own them as a part of an index, perhaps a 401(k). It's likely the company and its workers, then, mean little to them - any more than most of us who own stocks as part of a 401(k) or other private investments have a personal, felt stake in those companies.

That is how the investment economy works, and its upsides are all around us. But the cold, analytic perspective feels very remote right now, as the lives of hundreds of workers and their families in this community hang in the balance. If nothing else, this is a reason for anyone fortunate enough to have investments to consider them a little differently, to remember the real, human lives that go into making any business work - and the lives disrupted when they don't.

What's your take on the Packers Family Night change?

Retrieving results.
Watching practice is fine.(Your vote)
15%
574 votes
I'd rather watch a scrimmage.(Your vote)
23%
856 votes
I don't want to pay to watch practice.(Your vote)
27%
1015 votes
It doesn't matter to me.(Your vote)
34%
1271 votes

Catch up on the latest in our pregame show every game day.

Football fans

If you've ever answered "Who has the ball?" with "It's halftime," you might recognize The Airhead. Check out the characters in our cartoon gallery of oddball fans.

Special Reports

ORDER YOURS

Football fans

If you've ever answered "Who has the ball?" with "It's halftime," you might recognize The Airhead. Check out the characters in our cartoon gallery of oddball fans.

Special Reports