Deer Lodge sawmill has new owner – Sherm Anderson takes reins of one of the area’s biggest employers

With the signing of closing papers this week, the Louisiana-Pacific Corp. sawmill in Deer Lodge will become Sun Mountain Lumber Inc., owned by Sherman Anderson.

LP sold the sawmill and finger-jointer operation for an undisclosed amount as part of the company’s divestiture of its lumber businesses.

By Pat Hansen for The Montana Standard

http://www.mtstandard.com/articles/2004/03/03/newsbutte/hjjfjgjgjbjihc.txt

The Deer Lodge mill was established in 1961 as Northern Timber and purchased in 1973 by the Louisiana-Pacific Corp. In May 2002, LP announced plans to sell the company’s 935,000 acres of timberlands, its plywood, industrial panels and lumber businesses in order to enhance its long-term competitiveness and financial flexibility.

The plan to sell the lumber business raised concern and uncertainty in Deer Lodge. In October 2002, as lumber prices improved, LP pulled the Deer Lodge mill off the market, although it continued to talk with interested buyers and the mill continued to operate in a normal fashion.

Anderson, of Deer Lodge, said he was motivated to buy the mill because of the uncertainty of its future, and the impact that would have on Deer Lodge, Butte, Anaconda and the area.

One consideration in making his decision is the mill is successful, and not an operation that has to be turned around, he said. In July 2003, LP signed a letter of intent with Anderson. This week, the complex process related to contracts with the railroads, timber contracts, environmental issues, establishing credit lines with lenders, vendors and buyers, as well as extensive negotiations with LP concerning the purchase of the plants was completed.

LP officials said that Deer Lodge has been supportive and a wonderful place to do business.

"It is sad to say good-bye to the great people we have worked with for many years, but we wish them the best as they move forward with Sun Mountain," said company spokesman David Dugan.

Recently, Sun Mountain Lumber purchased equipment at the former Belgrade mill from the Town Pump organization, headquartered in Butte, which bought the property and mill from LP.

"LP put a lot of money into the Deer Lodge plant in the last three or four years, making it a modern, up-to-date mill, but we’re bringing much of the Belgrade equipment here to use for further improvements," Anderson said.

New replacement equipment being purchased includes a log yard crane and a Hyster fork lift.

The Deer Lodge sawmill has an annual production capacity of 125 million board feet of two-by-four and two-by-six studs. The finger-jointer plant has an annual production capacity of 110 million board feet. If lumber markets remain strong, it will give Sun Mountain Lumber the jump-start it needs.

In the new enterprise, Anderson will be personally involved in operations as president and operations manager with a management team that includes his son-in-law, Jason Jones as accountant/comptroller. Jones and his family are moving from Salt Lake City, where he has been employed as an auditing accountant with Deseret Management Corp. Susie Kramer will continue as office manager and Steve Flynn remains as resource manager.

Sales manager is Linda Sabrowski of Coeur d’Alene. For the past 23 years, Sabrowski has worked for LP in sales, the last five years as the company’s sales manager. Her husband Pat, who, was working in lumber sales with Western Timber Products, and Paul Toussaint, who remains in lumber sales and procurement, will round out the sales team.

Cal Boyle remains as the human resource, safety, and environmental manager with Bruce Thomas as safety and environmental mentor. Steve Moon will continue in his role as production superintendent and Robert Charles as quality control. Art Freeman is the sawmill supervisor; Lyle Ferguson will be the B shift supervisor; Richard Sargent is the finger-jointer supervisor and Tana Wheat is B shift supervisor; Dave Johnson is planer supervisor, Dave Lint is B shift supervisor; kiln and boiler supervisor is Dennis Doiron; and Shane Becker is maintenance supervisor.

"The management and workers are top of the line, and performing better than ever before, and that is a huge benefit to a buyer," Anderson said. "We’ll be going forward with approximately 230 of the current employees."

Staff will conduct inventory Thursday and Friday, but the mill and finger-jointer are expected to be fully operational under new ownership on Monday.

When the C shift was discontinued in the sawmill last November, it caused a ripple-effect throughout the operation as most of those workers were integrated into the work force in other areas. After a complete review of all operations, the work force was reduced slightly.

"It was a difficult decision that had to be made," Anderson said. "It was something that needed to be done going forward. I have given a lot of consideration to how this will affect people’s lives."

The released employees will receive a severance package in accordance with LP’s policy.

Anderson said he was impressed throughout the process by the commitment LP has to its employees and the community. Sun Mountain Lumber has developed a benefits package that includes health insurance, vacation time and retirement plan.

Anderson is a Republican state senator from District 28. He has been in the timber business since 1965. He and his wife Bonnie own Sun Mountain Logging, established in 1976, which is a separate but integral part of the new operation. The old Milwaukee Road offices, in the Sun Mountain Logging building, were recently remodeled and will house the lumber sales and forestry offices. Anderson’s sons, Rex and Troy, are taking leadership roles in the logging operation that employs 35 to 40 people. Rex manages the woods operation and timber crews and Troy oversees the maintenance shop and the trucking.

A supply of logs is continuing to come into the sawmill yard for spring use.

"We’ve been hit with an early thaw, but we’re hoping to get back into the woods and get some of the timber out before it gets too muddy," Anderson said. "We will continue with the current log and timber purchasing and operations. Timber supply is a serious issue facing the industry, but we are confident the federal government will begin to manage our national forests as they so desperately need to be managed, reducing mortality from fire and disease through thinning programs, thus releasing a timber supply that can be used rather than wasted."

With an annual payroll in excess of $7 million, the mill has a tremendous economic impact on the Deer Lodge community, and the Andersons have put their personal future on the line in order to ensure the plant’s continued operation.

"It was quite an undertaking," Anderson said. "It was frightening and exciting, and there were several times I wondered if it was worth it. It’s been quite a ride and very stressful, but I think it’s going to be great. We produce a quality product here, with a high quality work-force, and buyers are excited to continue doing business with us."

Pat Hansen of Avon is a free-lance writer and frequent contributor to The Standard. She may be reached via e-mail at [email protected].