November 30, 2006
Marcal Paper Files for Bankruptcy
New Jersey's Marcal Paper Mills Inc., which makes tissues and napkins, filed for bankruptcy Thursday, blaming soaring natural gas prices.
The privately held 74-year-old company said in a statement that it had sufficient funds to continue its normal business operations, including on-going employee, supplier and customer obligations.Despite ongoing negotiations with the company's energy suppliers, the cost of natural gas, electricity and steam that it uses in the production process has risen 40 percent over the past 12 months, Marcal said.
The price increases in energy have proven to be immensely difficult. Demands by our lenders created liquidity pressures which caused the company to file for the continued restructuring under Chapter 11.
Marcal employs more than 900 people in its Elmwood Park, N.J., and Chicago, plants.