Domtar to Shut Paper Mill, Affecting 195 Workers

Domtar Corp. (UFS), the world's second- largest maker of office paper, said it will permanently shut the paper machine and converting operations at its Dryden, Ontario, mill, affecting about 195 employees.

The company's annual production will be reduced by about 151,000 short tons of uncoated free-sheet paper, Montreal-based Domtar said today in a statement distributed by Canada NewsWire.

``Given adverse economic conditions and the continued softening of demand for fine papers, we need to further reduce our production capacity,'' Chief Executive Officer Raymond Royer said in the statement.

Domtar rose 21 cents, or 4.7 percent, to C$2.70 today in Toronto Stock Exchange trading. The shares have dropped 64 percent this year.

To contact the reporter on this story: Steven Frank in Toronto at sfrank9@bloomberg.net.

To contact the editor responsible for this story: Kevin Orland at korland@bloomberg.net.

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