“Faster, better, stronger” will also describe the supply chain if the overall paper market rationalizes SKUs in a similarly thoughtful, customer-focused way. For many categories of paper, the total days of inventory within the system can be mind-blowing.
Rather than engaging in a good-faith effort to forge a union between North America’s two largest makers of magazine-quality paper, NewPage said, Verso’s owners are engaging in “tactics of holdup and delay” to weaken NewPage and hinder its emergence from bankruptcy protection.
NewPage’s bankruptcy case presents Verso “with both significant opportunities and risks,” an attorney representing holders of first-lien debt wrote to the bankruptcy court today.
NewPage is eager to exit Chapter 11 and hopes to file a plan of reorganization within 30 days, but says a proposed merger with Verso would undergo an antitrust review of at least six months.
MEMPHIS, TN—Verso Paper, based here, held discussions with certain holders of NewPage Corp. senior secured notes in an effort to achieve a potential business combination involving Verso and the Miamisburg, OH-based paper manufacturer as part of a consensual plan of reorganization in NewPage’s Chapter 11 bankruptcy proceedings. However, the two sides were unable to reach an accord.
After thoroughly evaluating this proposal, NewPage determined that the combination with Verso posed significant downside risks to its stakeholders, employees and business. The company has also been advised that the first lien note holder group did not support the proposal.
Verso believes that a combination with NewPage would create a stronger business in the coated and supercalendered paper industry because of material cost savings. Despite the advantages, Verso has been disappointed with the lack of progress in advancing its discussions with the first-lien note holders.
NewPage Corp. has been awarded patents for PointTrac TT, a new paper-based substrate for printed Radio Frequency Identification labels. This technology facilitates low-cost production of printed paper RFID labels when compared with traditional multilayer plastic film substrates.
NewPage was pleased by the recent legislation passed by the U.S. House and Senate that will allow the Department of Commerce to continue to apply the countervailing duty law to non-market economy countries like China. This legislation will preserve intact the countervailing duty order in place covering coated paper, as well as other countervailing duty orders covering other products from China.
Paper consumption in North America is declining. This is a structural decline, and not just a cyclical decline. That means we can’t expect paper demand to “return to normal” when the economy recovers. This is the new “normal.” That point is not in debate, though experts do differ on the rate of decline.
While 2010 was resplendent with major printing company acquisitions, its successor came and went with little fanfare. Asset sales and closures took center stage in 2011, and crime continued to play a leading role from a news standpoint.
The parent company of NewPage Corp. and some of its U.S. subsidiaries have filed for Chapter 11 bankruptcy in order to facilitate an orderly debt restructuring. NewPage's product portfolio includes coated freesheet, coated groundwood, supercalendered, newsprint and specialty paper.