BUSINESS

NewPage announces bankruptcy filing

Posted Sept. 07, 2011, at 12:05 p.m.
Last modified Sept. 07, 2011, at 2:55 p.m.

RUMFORD, Maine — NewPage Corp. announced in a press release Wednesday that the company has filed for Chapter 11 under the United States bankruptcy Code.

“We strongly believe that the court-supervised restructuring we began today is the most effective means of strengthening our financial position and enhancing our standing as the leading producer of printing and specialty paper in North America” George F. Martin, president and chief executive officer for NewPage, said in a prepared statement.

NewPage Port Hawkesburry Corp., a Canadian subsidiary for NewPage, has started proceedings before the Supreme Court of Nova Scotia under the Companies’ Creditors Arrangement Act of Canada. The company has executed a Settlement and Transition Agreement and are waiting approval by the Canadian Court.

The Canadian company also announced on Aug. 22, it would take downtime at NewPage Port Hawkesbury Corp. due to economic conditions. The corporation is hoping to preserve its value while it continues discussion with potential buyers, the release stated.

NewPage is North America’s largest manufacturer of coated paper and employs about 750 people at its Rumford mill. The company also pays 46 percent of the town of Rumford’s property taxes.

NewPage has also filed a series of customary motions in the United States Bankruptcy Court that would allow it to continue its U.S. employee wages and benefits program. This motion will have to be court approved and is typical in Chapter 11 proceedings.

NewPage owns paper mills in Kentucky, Maine, Maryland, Michigan, Minnesota, Wisconsin and Nova Scotia, Canada.

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