PORT ANGELES — Negotiations continue on a possible purchase of the shuttered KPly mill, and an auction to sell the buildings and machinery remains on hold, said Josh Renshaw, who wants to buy the mill, on Tuesday.
“We are still holding negotiations,” said Renshaw, who wants to re-open the closed 19-acre plywood mill on Marine Drive.
He and a group of unnamed Port Angeles investors hope to acquire the mill’s equipment from Sterling Savings Bank of Spokane, which holds the lien taken out by Klukwan Inc., of Alaska, on the property.
An auction of all the equipment and buildings was originally set for last Thursday, but was postponed for purchase negotiations.
Port Executive Director Bob McChesney said Tuesday that a firm date had not been set for a new auction, but that it could be in April if negotiations are not fruitful.
Renshaw — who was the sales manager for KPly before Klukwan permanently laid off the 132 employees in April — said he didn’t know when an agreement might be reached.
Renshaw, 45, wants to put 172 mill employees to work at the mill, which has operated under different owners since 1941.
Under his ownership, the mill would revert to its original name: Peninsula Plywood.
Renshaw said he believes he can acquire and restart the mill with $1 million in local financing, a $1 million state loan and $3 million in bank loans.
If Renshaw acquires the mill, Rep. Kevin Van De Wege, D-Sequim, said he will pursue $250,000 in state funds for the replacement of two transformers at the site.
Van De Wege represents the 24th District, which covers Clallam, Jefferson and a portion of Grays Harbor counties.
Renshaw said that the mill, if restarted, would produce plywood siding for high-end homes and resorts.
That would require use of Douglas fir trees with minimal defects and cedar trees that aren’t in abundant supply.
Therefore, Renshaw said, the demand for these products continues to be in line with the available supply.
He added that the limited supply of these resources wouldn’t allow the mill to expand beyond its current capacity.
The mill, if restarted, would produce 5 million board feet of plywood a month, and it needs half of that amount to break even, Renshaw said.
Clallam County Superior Court issued a judgment on Sept. 26 that demands Klukwan pay $212,788.71 to the port for back rent and another $1,826.25 in attorney fees at 12 percent interest.
The company has not responded to the judgment, and its rent debt has continued to increase.
Klukwan board members have not responded to requests for comment.
The port on Monday took 90 days of the KPly debt off its books, a move it has made before as the KPly debt has mounted.
Arrears are taken off the port books after a tenant hasn’t paid for about 90 days, but the port continues to seek payment, said Bill James, finance director.
__________
Reporter Paige Dickerson can be reached at 360-417-3535 or at paige.dickerson@peninsuladailynews.com.
