Posts Tagged ‘Globe and Mail’

“Entrepreneurial paper chief explains contrarian investing strategy” in the Globe & Mail’s Small Business Week Interview. (Part 3)

Posted: Thursday, October 20th, 2011

The Globe & Mail three part series called ‘Talking to Entrepreneurs’ featured Chad Wasilenkoff, CEO Fortress Paper. In part three of the Globe and Mail’s Small Business Editor Katherine Scarrow’s feature video interview with Fortress Paper CEO Chad Wasilenkoff, where she called Chad Wasilenkoff, Fortress Paper a “born entrepreneur”.

Fortress Paper CEO Chad Wasilenkoff discusses growing up an entrepreneur, and why he’s always looking for a good deal in part 3 of Talking to Entrepreneurs

To watch part three of ‘Talking to Entrepreneurs’ please click HERE.

Part 1: ‘Fortress Paper chief turns tired mill into major venture.’ Watch video HERE

Part 3: ‘Entrepreneurial paper chief explains contrarian investing strategy’. Watch video HERE

The Globe & Mail three part series called ‘Talking to Entrepreneurs’ featured Chad Wasilenkoff, CEO Fortress Paper.

In part three of the Globe and Mail’s Small Business Editor Katherine Scarrow’s feature video interview with Fortress Paper CEO Chad Wasilenkoff, where she called Chad Wasilenkoff, Fortress Paper a “born entrepreneur”.

Fortress Paper CEO Chad Wasilenkoff discusses growing up an entrepreneur, and why he’s always looking for a good deal in part 3 of Talking to Entrepreneurs

To watch part three of ‘Talking to Entrepreneurs’ please click HERE.

Watch Other Videos In The Series:

Part 1: ‘Fortress Paper chief turns tired mill into major venture.’ Watch video HERE

Part 3: ‘Entrepreneurial paper chief explains contrarian investing strategy’. Watch video HERE

SOURCE:

The Globe and Mail: “Fortress Paper’s big money business”

Globe & Mail Small Business Week Interview Featuring Fortress Paper (Part 2)

Posted: Wednesday, October 19th, 2011

Globe & Mail Small Business Week Interview Featuring Fortress Paper (Part 2)

In part two of the Globe and Mail’s Small Business Editor Katherine Scarrow’s feature interview with Fortress Paper CEO Chad Wasilenkoff, they discuss how printing and protecting money is big business for Fortress Paper.

 Mr. Wasilenkoff discusses Fortress Paper being the ‘sole maker’ of the Swiss Franc for thirty years and how Fortress Paper is in the final stages of the next series Swiss Franc that will come out next year and “be the most state of the art and have more counterfeit features than any other banknote in the world”.

 To watch Part 2 of Fortress Paper in their three-part video series entitled Talking To Entrepreneurs, please click HERE.

 Part 1: Printing and protecting money big business for Fortress Paper.  Watch video HERE

 Part 3: Entrepreneurial paper chief explains contrarian investing strategy. Watch video HERE

SOURCE:

 The Globe & Mail: “Printing and Protecting Money Big Business for Fortress Paper

 

GLOBE AND MAIL: “Fortress Paper: Outside the Box, Crazy Like a Fox”

Posted: Wednesday, September 1st, 2010

Deep-value investor Chad Wasilenkoff continues to surprise

The first time Dan Buckle walked into the headquarters of Fortress Paper Ltd., he didn’t know what to make of it.

Located above a McDonald’s in North Vancouver, the dark, small office has no interior walls and features a pool table in lieu of a boardroom table. The first thing to greet visitors is a five-foot-tall wooden statue of Buddha.

“I remember walking in, ‘What the heck is this place?’ ” said Mr. Buckle, first an auditor of the company and now its finance director.

The operation, whose value has more than quadrupled to $360-million in the past year, is the brainchild of 38-year-old Chad Wasilenkoff, a deep-value investor who has made his latest fortune in Canada’s most unloved sector – forestry.

He’s in the midst of pulling off his biggest deal yet – resuscitating a dead pulp mill in Quebec. Scraping through the corners of the global bargain bin, he has a dozen more potential deals on the go, from Canada and China to Russia and South Africa, all in a mission to get his company to $1-billion in market capitalization.

Like other deep-value investors, Mr. Wasilenkoff searches for overlooked assets selling at great discounts. But deep-value investing can be a siren’s call: What looks like a deal can be a disaster.

So far Mr. Wasilenkoff has avoided missteps. When he started Fortress four summers ago, he spotted potential in pulp and paper, an area most investors shunned because of concerns over global overproduction. As a result, assets were available cheap.

“If [anything’s] 98 per cent off, I want two,” said Mr. Wasilenkoff in an interview over wings and beer at East Side Mario’s, a favoured haunt. He acknowledges it takes confidence to operate in areas most investors regard with alarm. “I can’t tell you how many times I’ve been called crazy. The more times I’m told I’m wrong, the more I know I’m right.”

He gets called crazy less often now. Joel Lusman, head of New York hedge fund Lusman Capital Management LLC, first heard of Mr. Wasilenkoff in early 2010. When the Quebec deal was announced, he quickly bought hundreds of thousands of Fortress shares. “This is one of the smartest deals I’ve ever seen,” Mr. Lusman said.

Mr. Wasilenkoff first made his name as a broker at investment bank Canaccord Capital in Vancouver, where he led a group of investors that took over a junior gold miner shortly before the price of gold doubled. He had another hit when he acquired a uranium asset when the price for that commodity languished.

After cashing out of uranium when its price spiked, Mr. Wasilenkoff started Fortress in 2006, putting up about $2-million of an $8-million private offering. His first moves at Fortress were to buy a banknote and security paper mill in Switzerland and a specialty wallpaper mill in Germany, both of which he viewed as poorly run, niche assets available at near fire-sale prices.

Within a year, he took Fortress public in a $46-million offering. But the stock languished – and then was sunk by the market crisis. By spring 2009, the price had fallen by nearly half from its IPO level.

Fortress’s decline was the kind that makes investors question an unconventional manager like Mr. Wasilenkoff, who favours ball caps and blue jeans as his working attire. Irwin Michael, head of a Toronto money manager that owns about 10 per cent of Fortress, fielded calls from his own investors about his stake in the company.

“You hear all these very descriptive four-letter words,” says Mr. Michael, who manages about $900-million at I.A. Michael Investment Counsel Ltd. “But we hung in. We had a lot of faith in Chad. [He’s] a workaholic, very methodical.”

By this past spring, when operating profit had doubled at the two mills, the stock too had doubled. And it was then Mr. Wasilenkoff sealed the Quebec deal. For $1.2-million, he bought a bankrupt pulp mill in Thurso, Que., a small town 50 kilometres northeast of Parliament Hill. The mill had once turned hardwood pulp into photographic paper, a business done in by digital cameras.

He saw another possibility. He has been a long-time believer in the potential of rayon, a fabric which is enjoying growing demand in Asia as a substitute for cotton, whose global production is in decline. Rayon is made from dissolving pulp and Mr. Wasilenkoff plans to make that dissolving pulp in Thurso.

“He’s not interested in the typical commodity game forestry usually falls into,” said analyst Daryl Swetlishoff at Raymond James. “He’s extremely driven, a very aggressive risk-taker, a grinder. Focused on value. And he’s not pretentious at all.”

Mr. Wasilenkoff figured he needed about $150-million to re-tool the mill. So he lined up veteran Quebec forestry executive Pierre Monahan to connect with the Quebec government. They eventually convinced Investissement Québec, an economic development company, to provide a low-interest loan of up to $102-million, allowing Fortress to make its plan work while putting up just $15-million of its own money.

In the five months since doing the deal, Fortress shares have doubled. Mr. Wasilenkoff’s original $2-million investment in Fortress is worth roughly $80-million today. He remains the company’s biggest shareholder.

He’s convinced more gains are ahead, but analysts at TD Newcrest say Fortress’s valuation might be stretched and worry about the pitfalls of trying to grow too quickly. RBC Dominion Securities said this month it is “very impressed” but added the share price now reflects the value Mr. Wasilenkoff has uncovered.

Mr. Wasilenkoff has always had an eye for value. In elementary school, he scooped up lost golf balls at a course near his childhood home in Calgary and resold them, soon buying and selling everything from Atari cartridges to Robert Bateman prints. He made enough to buy a used Porsche 911 for $15,000 in high school – which resulted in him being accused by a vice-principal of dealing drugs.

An investor since youth, Mr. Wasilenkoff initially wanted to get into property development. He ended up as a broker after getting a two-month temporary gig at Canaccord stapling stock receipts.

His early forays blew up, as he chased gold stocks in the Bre-X era, then got hammered by the tech-stock crash. Chastened, he embraced a deep-value philosophy in which he tried to build deals, rather than simply buying stocks.

What’s next is more deals – but Mr. Wasilenkoff , who previously insisted that he would only be at Fortress for a few more years and eventually start again from scratch, now gives some thought to sticking around longer. “There’s no guarantee that I’ll stop,” he said. “I am having a lot of fun.”

By Dave Ebner for The Globe and Mail. August 25, 2010.

SOURCE:
The Globe and Mail: “Fortress Paper: Outside the Box, Crazy Like a Fox”

The Globe and Mail lists Fortress Paper as a prime investment

Posted: Friday, February 26th, 2010

Over the past few weeks The Globe and Mail‘s Report on Business section has been taking a look at company stocks that tend to do well in the early stages of an economic rebound. According to Globe and Mail analysts, microcap companies – publicly traded companies that have a market capitalization of roughly US$250 million or less – tend to thrive in these post-crisis conditions.

This week, The Globe and Mail selected Fortress Paper as a microcap company poised to do big things in the coming months:

Fortress Paper Ltd., which has mills in Germany and Switzerland, makes security (such as currency notes) and specialty papers as well as wallpaper.

“It definitely has above-average profitability compared to other businesses that operate in the pulp-and-paper segment,” said Ralph Lindenblatt of Bissett Investment Management, a unit of Franklin Templeton Investments Corp.

“They have a proven management team, a self-sustaining business plan, strong balance sheet and opportunities to grow the business.”

The stock is “very attractively valued,” trading at 11 times trailing earnings, he added.

SOURCE:
The Globe and Mail: “Microcap growth at a reasonable price”

REPORT ON BUSINESS: “Turning Paper Into Cash”

Posted: Thursday, January 28th, 2010

Fortress Paper was covered today in the Globe and Mail’s Report on Business. Dave Morris reports on Fortress Paper:

At a 125-year-old factory in the shadow of the Swiss Alps, veteran watchmakers, trusted for their keen attention to detail, pore over the drums that will embed detailed watermarks into pristine sheets of paper stock. But not just any paper stock. Fortress Paper’s Landqart mill manufactures the security paper used to print passports, banknotes, bonds and even the certificates of authenticity that ship with each shiny new Rolex watch.

For Fortress Paper, the Vancouver-based company that owns and operates Landqart, the business is about as different from Canada’s beleaguered pulp and paper industry as a company can get. “With those traditional commodity papers, raw material goes in—pulp, water, chemicals—and when the finished product comes out the end, you package it and sell it,” says Chad Wasilenkoff, Fortress’s 37-year-old CEO, on the phone from his office in Vancouver.

“With banknote printing, it starts in the design phase.” Among the complex procedures that go into the creation of a future euro, Swiss franc or passport are treatments to bolster the paper’s resistance to wear and tear, as well as the application of watermarks and OVI (optically variable ink) strips, which cause the notes to change colour when tilted. “We view ourselves as a technology company on a paper platform,” says Wasilenkoff. Orders are booked solid through 2010.

The young CEO has made a career out of breathing new life into fragile companies in distressed sectors. After revitalizing Titan Uranium Exploration Inc., Wasilenkoff began looking for undervalued niches within the forestry industry. In 2007, Fortress purchased Landqart AG, a century-old security paper company with some old-world cred (Landqart is the exclusive manufacturer for the venerable Swiss franc, and has supplied euros to 10 of the 27 European Union member states—though, for security reasons, Wasilenkoff isn’t allowed to say which ones). Now, Wasilenkoff is banking on innovation to put Fortress Paper in as many wallets worldwide as he can.

In December, Fortress unveiled a new product called Durasafe at the Banknote 2009 conference in Washington, D.C. The new paper is more durable than most currencies in circulation, and allows banks to incorporate nifty—and difficult to counterfeit—features like transparent windows of varying size and shape. Fortress has invested almost $15 million over the past seven years perfecting the new notepaper.

“Unfortunately, in this industry, you can’t sell anything with a PowerPoint presentation,” says Wasilenkoff. “You have to have all the equipment, all the manufacturing, full-scale production samples for these national banks to review. Then they go and do their thing and, if it works, the orders start to roll in.”

Consider it the latest twist on the old adage that you need to have money to make money.

SOURCE: Dave Morris Report on Business / The Globe and Mail