Arauco Purchases Flakeboard

Arauco Purchases Flakeboard

Arauco Purchases Flakeboard 

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Chile-based Arauco has signed a purchase agreement for the acquisition of 100% of Flakeboard Company Ltd., based in Ontario, for US $242.5 million.

Flakeboard operates production sites in Canada and the U.S., including MDF plants in Malvern, Ark.; Eugene, Ore.; Bennettsville, SC; and Sault Ste. Marie, Ontario; particleboard plants in Albany, Ore; Bennettsville, SC; and St. Stephen, New Brunswick; high density fiberboard plant in St. Stephen; and several melamine lamination lines.

With the purchase of Flakeboard, which is expected to be completed during the second semester of this year, the annual production of Arauco panels in North America is expected to increase to 2.9 million m3 (1.6 billion SF, 3⁄4 in. basis), as a result of which Arauco reports it would become  the largest composite panel producer in America in terms of volume and third at the global level.

Arauco earlier this year purchased the Uniboard MDF and particleboard plants at Moncure, NC. Arauco also operates four MDF plants in Chile, Argentina and Brazil, a particleboard plant in each of Argentina and Brazil and a plywood facility in Chile. Arauco sources raw material from its 3.9 million acres (1.6 million hectares) of forest plantations in Chile, Argentina, Brazil and Uruguay.

According to Flakeboard President and CEO, Kelly Shotbolt: “We are extremely excited about our planned integration with Arauco and specifically about the opportunities that the new ownership structure brings for the larger company, our customers, our combined employees, and the communities in which we operate.”

Arauco has indicated that the North American assets will operate under the Flakeboard name and that the Flakeboard senior management team will be tasked with integrating and managing the combined operations. Shotbolt will be retained as head of Flakeboard North America.

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Where There’s A Will There’s A Way

Where There’s A Will There’s A Way

Story by Rich Donnell,
Editor-in-Chief

One of the more aggressive companies in recent years is Flakeboard, the Canada-based manufacturer of MDF, particleboard, melamine laminated products and other value-added items. We’ve been hearing a lot about Flakeboard’s investment in several melamine laminating lines, but we were wondering about its primary manufacturing plants, especially the ones it purchased from Weyerhaeuser back in 2006, and most specifically of these the MDF plant at Malvern, Ark.

Sometimes we visit plants and, as Forrest Gump said, “you never know what you’re going to get.” Especially a plant like Malvern, which has been around since 1968 and operated under four owners. Frankly, Malvern had fallen off our radar, until recently when we heard they had done some work there. During these recessed economic times, the word that a mill “has done some work” causes the editors at Panel World magazine to perk up. We asked for a visit and Flakeboard most graciously opened its Malvern doors.

While we enjoy visiting brand spanking new greenfield operations (see Uniboard-Moncure article, May 2010), we really get a charge out of touring an older plant that has undergone significant work. This is certainly the case at Malvern. For example, the old Washington Iron Works presses have undergone a total makeover, and the sanding line is now totally modernized. Operators weren’t shy about expressing their exuberance with the upgrade work and with the look of the “new” board product flowing through the plant.

At Malvern there is a spirit of re-birth, for two reasons really:

A) Flakeboard has committed some serious dollars to improving technologies throughout the plant.

B) Flakeboard is committing some serious time to improving the work force culture.

A and B don’t necessarily go hand in hand; that is, we’ve visited many a plant that did A and ignored B. From an editor’s perspective, these plants don’t make for a very enlightening visit.

You don’t necessarily have to do A while doing B, but it would seem that the implementation of B will become more effective if it’s tied into A.

However it’s done, we seem to be seeing more plants concentrating on their work force culture. There are lots of definitions of work force culture, and I’m sure there are consultants who know the exact definition, but the common thread appears to be greater participation and accountability for the work force. Pushing responsibility and decision making down the ladder if you will. Flakeboard at Malvern has gone so far as to strike the term “supervisor” from its glossary.

Of course employee empowerment is not a new concept. And we’ve seen many companies who began to change its work force culture, only to have an economic recession or an economic boom cast aside the noble notion.

Flakeboard is not one of these companies. For Flakeboard, employee involvement is part of its business philosophy. The plant manager at Malvern, Tom Quesenberry, told us that what makes the new cultural shift at Malvern so interesting is that he can look at other Flakeboard plants where the culture is embedded and clearly see where Malvern is headed.

It’s amazing what you can do at a 43-year-old composite board plant.