Marcal Files Plan of Reorganization in NJ Court

June 25, 2007 - Marcal Paper Mills, Inc. said that its proposed Plan of Reorganization has been filed with the United States Bankruptcy Court for the District of New Jersey. The company also announced that it has secured a $60 million commitment from Apollo Capital Management, L.P.

"This is an important and positive step forward for the company, and we are pleased that all of the parties were able to work together to formalize this Plan of Reorganization. We appreciate the confidence that the parties have shown in the company, our management team, our employees and our business strategy," said Marcal's chairman and CEO Nicholas Marcalus.

Representatives of the Marcal's Official Unsecured Creditors Committee support the economic terms of the proposed Plan. Under the Plan, these creditors are projected to receive 52 cents on the dollar on their unsecured claims.

As part of the Plan, members of the Marcalus family and Apollo Capital Management will together invest more than $11.5 million, plus other forms of consideration, to acquire and hold 100 percent of the capital stock of a new holding company, which in turn will own 100 percent of the outstanding shares of a reorganized Marcal Paper Mills.

Marcal simultaneously filed a Disclosure Statement that explains the details of the proposed Plan. The company will request that a hearing on the adequacy of the Disclosure Statement and related procedures to solicit votes in favor of the Plan be scheduled by the Bankruptcy Court for July 13, 2007.

Marcal Paper Mills is a privately-held, fourth generation family business. It employs over 900 people in its Elmwood Park, New Jersey and Chicago, Illinois manufacturing operations. The company produces over 160,000 tons of finished paper products, including bath tissue, kitchen towels, napkins and facial tissue, distributed to retail outlets for home consumption and to distributors for away-from-home use in hotels, restaurants, hospitals, offices and factories.

SOURCE: Marcal Paper Mills Inc.

See related story:
Court Oks Financing Deal for Marcal Paper Mills (1/5/07)

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