Gulf States rumors begin

Published 12:00 am Friday, April 1, 2005

Jonathan McElvy / Demopolis Times Writer

DEMOPOLIS — Exactly four months after Gulf States Paper Corp. and members of its employee union reached a contract agreement, speculation about the sale of the company’s Demopolis mill has spread at a torrid pace.

Earlier this week, word began to rumble through this community that Gulf States has found a buyer for the Demopolis mill and that environmental tests are being performed at the industry in preparation for the sell.

Dan Meissner, spokesman for the Tuscaloosa-based company, offered an exasperated response to the latest round of speculation.

“You know, we’ve heard these things, it seems like, every year,” he said. “Every year or two, this comes back up.”

As Meissner put it, the latest news “is just purely rumor.”

When asked if the company had plans to sell its Demopolis mill, Meissner responded by calling the talk “rumor.” When asked if Gulf States is marketing the Demopolis mill, he again said any news in regard to the mill is “rumor.”

Olen Kerby, president of BancTrust and former chairman of the Industrial Relations Board for Demopolis, said he hasn’t heard anything specific to the latest news about Gulf States.

“I guess you hear it every couple of years,” Kerby said. “Other than that, this is the first I’ve heard of the latest talk.”

While Meissner didn’t directly answer whether the Demopolis mill is being marketed, Kerby said the small-town phenomenon of circulating stories may be at the root of the latest rumors.

“That’s just the way things work in towns like ours,” he said.

Throughout 2004, Gulf States and members of its employee union struggled through a contract negotiation process that finally came to an end on Dec. 2, 2004. One of the barriers between employees and company officials was Gulf State’s desire to remove its pension plan and move to something like the popular 401k retirement plans.

During the course of the negotiations, many indicated Gulf States wanted to remove the pensions because that sort of retirement plan, feasibly, could hurt the potential sale of the Demopolis mill.

When the union and Gulf States finally reached a contract agreement, both sides won. Employees at Gulf States now are given the option of keeping the existing pension plan or moving to an “enhanced” 401k plan offered by the company.