Bloomberg News

SP Newsprint Holdings Files for Bankruptcy in Delaware

November 15, 2011

(Updates with company’s comment in third paragraph.)

Nov. 15 (Bloomberg) -- SP Newsprint Holdings LLC and three affiliates, manufacturers of newsprint and paperboard, filed for bankruptcy protection in Delaware.

The company listed both assets and debt of $100 million to $500 million in Chapter 11 documents filed today in U.S. Bankruptcy Court in Wilmington, Delaware.

“As a result of weak economic conditions coupled with record prices for key raw materials, the company’s profit margins have been reduced to levels that are not able to support servicing of current outstanding debt,” Ed Sherrick, the company’s chief financial officer, said today in a statement.

SP Newsprint said in the statement it will explore options to continue its business as a going concern during the bankruptcy process. The newsprint producer is negotiating with some of its lenders regarding financing to help fund operations while in bankruptcy.

The company and its affiliates’ 30 largest unsecured creditors are owed about $19.4 million, according to court papers. Waste Management is listed as the biggest with a claim of $3.8 million, followed by Rocktenn Recycling, owed about $1.4 million, and Lazard Ltd. with a claim of about $1 million. The Pension Benefit Guaranty Corp. is listed as having a disputed claim of an unknown amount.

Equity holders of SP Newsprint Holdings, based in Greenwich, Connecticut, include Peter M. Brant with a 49.40 percent interest; SP Newsprint Holdings Inc., with a 35.74 percent interest and White Birch Paper Co., with a 15.86 percent interest, according to court papers.

The case is In re SP Newsprint Holdings LLC, 11-13649, U.S. Bankruptcy Court, District of Delaware (Wilmington).

--Editors: Steven Farr, John Pickering

To contact the reporters on this story: Dawn McCarty in Wilmington at dmccarty@bloomberg.net; Michael Bathon in Wilmington, Delaware, at mbathon@bloomberg.net.

To contact the editor responsible for this story: John Pickering at jpickering@bloomberg.net


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