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Communist China Hoping To Buy Paterson Paper Plant

August 13, 1985

NEWARK, N.J. (AP) _ A closed Paterson paper mill could return to operation soon as the first overseas industrial venture of the People’s Republic of China.

The China National Packaging Corp., the state packing industry, has been looking to buy a paper plant for three years, officials said.

″Since (China) opened its doors, it has wanted to understand American business,″ said Irwin Silberman, vice president of Pan China International Inc., a New York-based company representing the Chinese.

If the 60,000-square-foot Morris Paper Board plant, closed by Berles Carton Inc. in bankruptcy proceedings last year, isn’t available, the Chinese are considering several other buildings, including one in Miamisburg, Ohio, Silberman said.

″They want to understand American philosophies and be able to deal with the Americans. They also want to create a relationship with American companies,″ he said.

Ven Hai Wu, president of Pan China, said China is particularly interested in the United States because of its resources.

″China is short of fibers,″ Wu said. ″They have to import a lot of paper. The United States is rich in woods, pulp and can use waste paper.″

A Chinese delegation met with Paterson Mayor Frank Graves, his staff and the plant’s bankruptcy trustee, Jack Birnberg, two weeks ago.

Although Silberman said his company has found an American firm in Philadelphia to manage the plant for the Chinese, this would be the first attempt at a solo venture abroad.

The Chinese and another U.S. company already are involved jointly in an electric fan business in Chicago.

″Everything is loose,″ Silberman said of packaging in China. ″Improved packaging would eliminate a lot of spoilage and waste. China wants to export goods, and to do that they will have to improve packaging.″

Silberman said the Paterson plant has advantages, including its proximity to a shipping port, its relatively small size and available work force. The plant, which would employ 60 to 80 workers if reopened, has its disadvantages too, among them a $300,000 debt to the city.

But the Chinese may not get a shot at the plant. There is a competing bid from Paterson Paper Board Co. Inc., which has placed a deposit, Silberman said.

Morgan Woods and Dominic Desiderio, whose family owns and operates Whippany Paper Board in Whippany, formed the company to buy the Paterson plant.

Graves said Birnberg told him that he was going to recommend to the court that the New Jersey company’s bid be accepted.

Birnberg would not comment on what recommendation he would make, but said both companies will be able to bid in federal court.

″If we can get the time to get our funding together will depend on whether we can make a bid,″ Silberman said. ″That’s up to the courts. We need about 45 to 90 days. It would seem to be an advantage to have two bidders.″