Question :

reflect on the business decision Blue Wolf made regarding the purchase of the Neenah plant. Draw on the knowledge you have gained in this module to complete this activity. Address the following questions in your reflection:

• How realistic are Blue Wolfs plans to buy and turn the plant around?
• If you were a Blue Wolf stakeholder or board member, would you accept, reject, or alter the course of action? Why?
• Which factors are key to consider in order to make an informed decision about this case? Why?

Case Details :

Atlas Holdings LLC ("Atlas") and Blue Wolf Capital Management ("Blue Wolf") announced today that they have entered into a formal agreement to acquire Neenah Paper, Inc.'s (NYSE: NP) Pictou, Nova Scotia pulp mill and associated timberlands business through affiliates. Atlas, Blue Wolf, and the mill's management will own and run the new firm, which will be known as Northern Pulp Nova Scotia Corporation ("Northern Pulp"). Neenah Paper will keep ownership of its 500,000 acres of Nova Scotia forest. The deal is scheduled to be completed in the second quarter.

The Pictou mill produces high-quality, tensile-strength pulp for use in tissue, printing, and writing papers. Northern Pulp will take over the mill's operations and timber business, as well as existing customer contracts, supply agreements, labor agreements, and pension obligations, for a small fee. To aid the new company's transition to stand-alone status, Neenah will pay it between $15 and $20 million. The first payment will be made at the time of closure, and the second will be made in the third quarter. Working capital, capital spending levels, and reimbursement to Neenah for substantial repair at the Mill finished in May 2008 will all be factored into the final figures. Furthermore, Northern Pulp and Neenah Paper have agreed to a market-based fiber supply arrangement to secure the mill's continued fiber supply.

The purchase will allow the mill to continue operating, which has been a vital part of the northern Nova Scotia economy since its inception in 1967. A significant decline in the lumber business has had a negative impact on the Canadian pulp industry.

The current management team will stay on and become equity shareholders in the new company. Keith L. Johnson, a Nova Scotia native, will continue to lead Northern Pulp in his current role as General Manager.

"The Pictou mill is well-maintained, has good customer relationships, and is in a prime location relative to both the Nova Scotia wood basket and its clients in the United States and Europe," said Adam Blumenthal, Managing Partner of Blue Wolf. "These characteristics will provide a solid foundation on which [to develop an independent, competitive company that can weather the current market downturn and thrive as it recovers. We anticipate to work closely with management and labor to increase productivity throughout this difficult period, as we do with all of our investments."

"While the pulp sector is currently in a 'perfect storm' caused by increasing wood chip costs, a strong Canadian dollar, and high energy costs, we believe Northern Pulp is a viable business," said Timothy Fazio, Managing Partner of Atlas. We have years of expertise dealing with complex difficulties in the commodity industry, and we are certain that our knowledge, together with that of senior management and the people who work here, will enable us to keep this mill running as a significant player in the global marketplace."

The mill has a capacity of 270,000 metric tons/300,000 tons of pulp per year. Northern bleached softwood kraft pulp accounted for over 90% of the mill's output in 2007.

Blue Wolf and Atlas are making their second investment in the business. Finch Paper Holdings, a pulp and paper factory in northern New York State, was purchased by the investors last year.

Atlas and Blue Wolf were represented by Davies Ward Phillips & Vineberg LLP as primary counsel.

Blue Wolf Capital Management LLC is a private equity firm that invests in businesses where good management of complicated stakeholder relationships, such as government and labor, can transform firms and create value.

Atlas Holdings LLC is a holding company that works in a variety of industries, including paper, packaging, wood products, and steel. Atlas owns and operates four paper mills and nine packaging units across the United States and Canada. Atlas has facilities in over 30 different sites across North America and Europe. Approximately 3,000 people work for Atlas' linked firms.

Note : I need the answer Question 1 , 2 and 3