More than 160 jobs at the Kawerau pulp and paper mills will be saved as a result of a US majority-owned buyer picking up the assets. The Overseas Investment Office has given approval for NS Norway to buy Norwegian company Norske Skog’s Kawerau assets for $29.9 million.

The OIO said Norse Skog was financially distressed and owned the freehold interest in 351 hectares at Fletcher Ave, Kawerau where the mill is located, and 48ha at Springs Rd Kawerau.

“We consider that without this Investment, the Tasman mill and New Zealand- based business of Norske Skog Tasman are likely to be closed down in the short term,” the OIO said. “This Investment is likely to enable the business and Tasman mill to continue operating while it is economically feasible to do so.”

Norske Skog’s New Zealand subsidiaries have assets valued at more than $100m, but the OIO consent refers to the “sensitive land” that requires OIO consent.

The buyer, NS Norway, is an international newsprint and magazine paper producer that has been operating for about 50 years.

NS Norway intends to continue to run the business from New Zealand in conjunction with its international paper mills and product supply chains across several countries including Austria, Ireland, Poland, and Australia.

“We note that the international paper market is experiencing aggregate oversupply issues and there is generally expected to be on-going decreasing demand for paper products over the longer term,” the OIO said.

Government ministers were satisfied that the investment would be likely to achieve a number of benefits, including saving the 160 jobs, maintaining export receipts of more than $65m a year, market competition in the chip and pulp log processing industry particularly in the central North Island, maintaining productivity on the land, and continuing to produce approximately 140-150 kilotonnes of newsprint.