Smurfit-Stone files for bankruptcy

[thelakelander]

This may have a negative impact on the First Coast when things finally shake out.  Smurfit-Stone operates two paper mills, two corrugated box plants, two paper recycling plants and a display design studio in Jacksonville and Fernandina Beach.

Jan. 26 (Bloomberg) -- Smurfit-Stone Container Corp., North America’s second-largest maker of corrugated packaging, filed for bankruptcy in the face of falling demand and heavy debt payments.

The petition for Chapter 11 bankruptcy, filed today in a U.S. Bankruptcy Court in Wilmington, Delaware, listed $5.6 billion in consolidated debt and $7.5 billion in consolidated assets as of Sept. 30. Twenty-four affiliates also sought court protection.

The company joins other pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corp. Durango SAB, Mexico’s largest papermaker, sought U.S. bankruptcy protection in October. Quebecor World Inc., a magazine printer, and Pope & Talbot Inc., a pulp-mill operator, also filed cross- border bankruptcies for their operations in the U.S. and Canada.

“Smurfit has historically been saddled with high debt and hasn’t been generating the cash flow or the asset sales to bring down that debt,” Joshua Zaret, an analyst at Longbow Research in New York, said today in a telephone interview. “This was the albatross that was overhanging the company.”

Smurfit-Stone, which is also one of the world’s largest paper recyclers, has 22,000 employees in the U.S., Canada, Mexico and Asia, according to its Web site. Operations outside of the U.S. and Canada are excluded from the bankruptcy process, the company said.

full article: http://www.bloomberg.com/apps/news?pid=20601087&sid=aI0NTPnXCmC4&refer=home