Smurfit-Stone files for bankruptcy protection
A giant multinational company that closed a plant in west Quebec this fall is now seeking bankruptcy protection.
More than 200 employees in Portage du Fort, Que., located across the Ottawa River from Renfrew, found themselves without work when Smurfit-Stone permanently closed its west Quebec mill at the end of October.
Smurfit-Stone has been struggling to repay its debt, which at the end of the third quarter was US$3.5 billion -- nearly half its yearly revenue of roughly $7.5 billion.
Now, the company, which employs 22,000 people in 150 mills world-wide, is trying to reorganize its finances.
The union, representing about 1,000 workers at five Smurfit-Stone operations in Quebec, said workers are nervous that more jobs will be cut and the pensions of retirees will be affected by the outcome of the company's restructuring plan.
"What they told us today is that there won't be any (layoffs) in the short-term, but these situations are evaluated daily in terms of the markets and the order book," said Renaud Gagne, Quebec vice-president of the Communications, Energy and Paperworkers Union.
While the restructuring plan will examine whether to close high-cost mills, there are no indications that Quebec will be affected, he said.
The company is the largest producer of cardboard box materials in North America. It operates 18 plants in Canada, including two mills and two other plants in Montreal.
More than 340 workers in Quebec and Ontario lost their jobs late last year as the company shut down two operations to avoid cash losses amid rapidly deteriorating conditions.
The cardboard maker's shares (Nasdaq:SSCC) fell two cents to four cents a share in Monday trading on the Nasdaq market. They traded as high as $9.99 over the past year but could be worthless after the reorganization.
With a report from The Canadian Press