Carter Holt Harvey signs maintenance agreement

Carter Holt Harvey signs maintenance agreement at Kinleith

Carter Holt Harvey CEO Peter Springford announced that the company had signed today an agreement with ABB Maintenance Services Ltd to provide maintenance services at the Kinleith pulp and paper mill in Tokoroa. The contract will help Kinleith to achieve around $100 million in accumulated savings and cost improvements over the next 5 years.

“Carter Holt Harvey’s partnership with ABB will play an important role in giving the mill a sustainable future. In the intensely competitive global pulp and paper market, and against the backdrop of low pulp prices and a rising Kiwi dollar, Kinleith has to change if it is to survive.

“The signing of the maintenance partnership with ABB will be followed by the issuing of 266 redundancy notices, predominantly to maintenance workers. The redundancies are disappointing, however a large number of these workers may be employed by ABB at the Kinleith site.

“The timing of the redundancies is regrettable. For some time, however, maintenance and stores workers at Kinleith have been telling us that they would prefer certainty now, ahead of any further hold-ups in what has been a difficult nine-month process.

“Delays, stop work meetings and extensive consultation under the Employment Relations Act have slowed down the changes necessary at Kinleith. In the meantime Kinleith continues to lose money and the global pulp market gets tougher.

“New Zealand simply can not afford this slow pace and cost of change. It makes it more and more difficult to build a case for further investment here.

“It is vital that we make a success of Kinleith. It is too important to New Zealand and the forestry industry to fail. But if we can’t act quickly to adapt to market needs then the mill’s long-term sustainability is questionable.

“We remain determined to make Kinleith a success in spite of the difficulties it faces”, said Mr Springford.

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