Marcal Paper Mills $160 million asset sale approved

By Caroline Salls

Pittsburgh, Jan. 18 - Marcal Paper Mills, Inc. obtained court approval of the $160 million sale of substantially all of its assets to an affiliate of second-lien loan agent NexBank, SSB, according to a Marcal news release.

The company said the sale will allow it to emerge from Chapter 11 bankruptcy as a "new, vibrant, ongoing concern."

Under the asset purchase agreement, NexBank will form Marcal Paper Mills Inc., LLC, as the buyer and holder of substantially all of the company's assets.

In addition, the release said NexBank affiliate has reached agreement with the United Steel Workers on a new collective bargaining agreement and has agreed to pay all of the vendor's claims incurred during Marcal's bankruptcy proceeding and honor all customer obligations.

Marcal Paper Mills, an Elmwood Park, N.J., manufacturer and distributor of bath tissue, kitchen towels, napkins and facial tissue, filed for bankruptcy on Nov. 30, 2006 in the U.S. Bankruptcy Court for the District of New Jersey. Its Chapter 11 case number is 06-21886.

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