By The Associated Press
Tuesday, December 1, 2009
Smurfit-Stone Container Corp., the largest producer of cardboard box materials in North America, said Tuesday it has filed a reorganization plan in U.S. and Canadian courts and expects to emerge from creditor protection in spring 2010.
Smurfit-Stone, which filed for protection from debtors in January, said it has prepaid the US$43 million remaining of a U.S. term loan and expects to prepay about $7 million against its Canadian term loan by the end of December.
Under the plan, Smurfit-Stone's debt will be converted to equity. When it filed for protection, the company's debt reached $3.5 billion, nearly half its yearly revenue of roughly $7.5 billion.
Smurfit-Stone's Canadian operations will be sold to a new subsidiary that will be clear of debt, with lenders getting cash or common stock.
The company employs nearly 22,000 people working at about 150 mills and plants across North America and Asia, with its Canadian business employing more than 2,600 people at 18 plants.
Since 2006, the Chicago-based company has closed 36 boxboard plants and six mills, including three plants and three mills in Canada.
