The owners of Oughtibridge Paper Mill have appointed a property company to advise on the potential sale of the site after it closes in 2015.
SCA and property partner Capita say they intend to review the estate and consult with local stakeholders to discuss its future.
Paul Oliver, SCA programme manager said: “An important part of the brief we have given to our property partner is that, as an ethical company, we want to exit the site responsibly and with consideration for the views of the local community and of the environment.”
Oughtibridge residents are concerned it may be used for housing – which they say would put strain on services.
Swedish firm SCA took over Oughtibridge Paper Mill after buying Georgia Pacific’s entire European operation in 2012.
It is one of Sheffield’s largest and most historic employers. Some 161 jobs face the axe when it closes.
The site dates back to Victorian times, when it was founded as Dixon’s Mill, and employed several thousand people in its heyday.
However, paper production ceased after the 2007 floods, leaving only processing and packaging of paper brought in from another mill in Lancashire.
Current work at Oughtibridge involves converting paper into commercial toilet rolls, paper hand towels, wiper rolls and medical rolls.