Lott handling 'shameful,' Jones says
'Aware of issue,' government says of company's woes
The Newfoundland and Labrador government bungled its handling of a financially troubled German company that expressed interest in the former AbitibiBowater newsprint mill, alleges Liberal Leader Yvonne Jones.
Meanwhile, the government said Tuesday it was aware that Lott Feinpappen GmbH & Co had filed for bankruptcy protection in Germany earlier this month, almost a month after its officials toured the shuttered mill in Grand Falls-Windsor.
The government had said it was expecting a formal plan from Lott — a century-old company that specializes in high-quality paperboard products — to be delivered on Monday.
"It is shameful, and it just goes to show that this government is incompetent in handling some of these files," Jones told CBC News.
"How do you engage with a company without ever doing any research or background checks on them?"
Natural Resources Minister Kathy Dunderdale last week revealed Lott as the German company interested in taking over the Grand Falls-Windsor mill, which AbitibiBowater shut down while staving off its own bankruptcy worries.
Dunderdale's office said Tuesday she was not available to comment on the controversy, but issued a statement on her behalf.
"The Department of Natural Resources is aware of the issue with Lott Paper. It has received a proposal and a business plan is forthcoming, which will be reviewed, and a decision made as to whether it has merit," the statement said.
"Once that process is complete the minister will comment. As clearly indicated by the minister previously, the provincial government is approaching this situation very cautiously."
A lawyer with the Achern-based firm of Schultze & Braun told CBC News on Monday that Lott's legal status means it cannot proceed with any possible deals in Canada.
Lott was sold last year to a private equity firm. It had gone through bankruptcy protection proceedings in 2004.
Jones said the government ought to have known much more about the company before revealing its interest in the Grand Falls-Windsor site.
"I'm very upset that government has once again raised expectations, and raised the hopes of people of Grand Falls-Windsor, on a company that is just one complete fiasco," Jones said.