Bucking a trend that has seen private equity firms buy business to bleed then shut down, United Steelworkers (USW) members at three Wisconsin paper mills and KPS Capital Partners have reached a new four-year collective bargaining agreement that workers ratified today.
The agreement comes in anticipation of the private equity firm successfully creating the largest specialty paper company in North America with its pending purchase of Wausau Paper mills in Rhinelander and Mosinee and a Thilmany mill in Kaukauna. There are some 1,400 workers at those mills. Says USW President Leo W. Gerard:
We are proud of the leadership that our local unions have shown in bringing their respective memberships together to ratify this important deal in the specialty paper sector. This particular piece of the industry still has enormous growth potential and has long been in need of a new strategic vision to capitalize on that opportunity.
USW District 2 (Wisconsin and Michigan) Director Michael Bolton says, the approach KPS took in working through these negotiations to create a world-class paper company:
Should serve as a reminder to hostile short-sighted venture capitalists—and even our own state government—that a big part of value creation is people sitting down together to solve difficult problems.