Buyer of closed Madison paper mill envisions success with new use

MADISON — Gregory Schain of New Mill Capital Holdings in New York City points to one recent success his company has had in Maine as he looks to the company’s newest acquisition: the shuttered Madison Paper Industries mill.

New Mill Capital’s success came with the sale and repurposing of the 265,000-square-foot Hostess Brands bakery in Biddeford a year ago. FedEx opened a distribution center there last year, Schain said.

“If you look at our history of projects, we buy a lot of closed plants all around the country,” Schain said in a phone interview Tuesday. “It’s never our intention to see a plant sit idle. It’s not in our interest, it’s not in the town’s interest, it’s really not in anybody’s interest. Our plan long-term is to see something happen at that site.”

The Madison mill property was sold last week to a joint venture of New Mill Capital and Perry Videx of Hainesport, New Jersey, and Infinity Asset Solutions of Toronto. Former mill owners UPM-Kymmene Inc. and Northern SC Paper Corp., a subsidiary of The New York Times Co., announced the sale of the mill site Friday in an emailed statement.

Madison Paper closed in May, putting about 215 people out of work.


Schain said one of the provisions of the sale is that UPM has restricted the use of some of the equipment on site, meaning certain parts of the paper machine and equipment will have to be sold so another company can’t compete with and undercut UPM in the paper market.

New Mill Capital cannot move in a company that would produce the supercalendered paper that UPM was making at about 195,000 tons a year when the mill closed.

“There are certain parts of the paper machine that are considered proprietary for UMP. They’re forcing us to basically scrap it or sell it off-site,” he said. “That includes the head box and a couple of other pieces that are considered critical. No one who produces supercalendered paper can use that equipment on-site or off-site. Nobody can come in and do what they were doing again.”

Schain said that by comparison, what New Mill Capital did in Biddeford was a success at filling the entire space left vacant when Georgia-based Flowers Foods vacated the Hostess premises, a 40-acre property within a mile of the Maine Turnpike. Flowers Foods did not allow another baker to take over the property, Schain said.

“FedEx is now distributing all throughout New England from that building,” he said.

The Madison mill acquisition – which closed Thursday for an undisclosed price – includes the real estate of the main paper mill site as well as all mill equipment. The mill’s hydropower assets are being marketed separately from the mill transaction.