On November 30, 2021, Paper Excellence completed the acquisition of all the outstanding shares of Domtar Corporation. The acquisition was subject to the review by the Canadian Competition Bureau, which outlined certain stipulations in a consent agreement before providing their final approval.

The consent agreement filed by the Canadian Commissioner of Competition (“Commissioner”) with the Competition Tribunal fulfilled the final condition to the closing of the business combination. According to the consent agreement, following the closing of the business combination, Domtar’s pulp mill in Kamloops, British Columbia must be sold in order to resolve the Commissioner’s concerns about the business combination’s implications on the purchase of wood fiber from the Thompson/Okanagan region in British Columbia.

The mill will be sold to an independent purchaser to be approved by the Commissioner.

The results of operations of Domtar’s pulp mill in Kamloops, British Columbia were reclassified to discontinued operations. These results have been summarized in Earnings (loss) from discontinued operations, net of taxes on the Company’s Consolidated Statements of Earnings (Loss) and Comprehensive Income for each period presented. The Consolidated Statements of Cash Flows were not reclassified to reflect discontinued operations.

On March 1, 2021, Domtar completed the sale of the Company’s Personal Care business to American Industrial Partners (“AIP”) for a purchase price of $920 million in cash, including elements of working capital of $130 million. Domtar received a net amount of $897 million, which represents the selling price minus the settlements of the net indebtedness and other elements of working capital adjustments. In connection with the sale, the Company entered into Transition Services Agreements with AIP pursuant to which the Company agreed to provide various back-office and information technology support until the business is fully separated from Domtar.

The results of operations of the Company’s Personal Care business were reclassified to discontinued operations. These results have been summarized in Earnings (loss) from discontinued operations, net of taxes on the Company’s Consolidated Statements of Earnings (Loss) and Comprehensive Income for each period presented. The Consolidated Statements of Cash Flows were not reclassified to reflect discontinued operations. Personal Care was previously disclosed as a separate reportable business segment.

	Successor		Predecessor
	For the three months ended
	March 31,		March 31,
	2022		2021
	$		$
Sales		88		227
Operating expenses
Cost of sales, excluding depreciation and amortization		67		169
Depreciation and amortization		—		14
Selling, general and administrative		—		24
Closure and restructuring costs		—		1
Transaction costs		3		—
Other operating loss, net		—		1
		70		209
Operating income		18		18
Net loss on disposition of discontinued operations		—		32
Earnings (loss) from discontinued operations before income taxes		18		(14	)
Income tax expense		5		—
Net earnings (loss) from discontinued operations		13		(14	)

Major classes of assets and liabilities classified as held for sale in the accompanying Balance Sheets were as follows:


	At
	March 31,		December 31,
	2022		2021
	$		$
Assets
Receivables		56		50
Inventories		73		82
Long-term assets		201		155
Total assets of the disposal group classified as held for sale on the Consolidated Balance Sheets ⁽¹⁾		330		287

Liabilities
Trade and other payables		32		26
Income and other taxes payable		1		—
Long-term debt due within one year		1		1
Long-term debt		4		4
Deferred income taxes and other		—		27
Other liabilities and deferred credits		5		5
Total liabilities of the disposal group classified as held for sale on the Consolidated Balance Sheets ⁽¹⁾		43		63

	Successor			Predecessor
	For the three months ended
	March 31,			March 31,
	2022			2021
	$			$
Cash flows from operating activities		30			15
Cash flows used for investing activities		(1	)		(4	)