NewPage files for bankruptcy

[Skiddah]

http://www.mainebiz.biz/news48442.html

Scary news for the pulp market in Western Maine.

[furltech]

scary news for me also in nova scotia as new page was responsible for 85% of my income .just bought a harvester in april so now we will have to see how things go .oh well if it was easy everyone would do it .

[Woodhauler]

Not just western maine, It will be bad all over the state! Shut down that mill and the wood will have to go somewhere and that means the other mills can pay what they want!

[Woodhog]

Bowaters and Irving will have it all their way with fiber prices around here now.

[thecfarm]

A lot of jobs are on the chopping block. I have sold pulp to them.

[Skiddah]

Not just western maine, It will be bad all over the state! Shut down that mill and the wood will have to go somewhere and that means the other mills can pay what they want!

I agree with your Woodhauler!  I was thinking about what Verso's price would be in Jay if NewPage closes.  Through the floor I'd guess.  Huge trickle down effect to the surrounding areas too, unfortunately that seems to be par for the course in today's economy.

[grassfed]

That report ain't necessarily bad news it says that they are reorganizing and that they have

JP Morgan for up to $600 million in debtor-in-possession financing, which Chief Financial Officer Jay Epstein said will allow the company to continue operating its U.S.

some new financing lined up. They have been trying to do this for awhile. At this point the people that will get hurt will be people with common stock and unsecured debt...

Here is a link with some more info http://dealbook.nytimes.com/2011/09/07/cerberuss-newpage-files-for-bankruptcy/

[JDeere]

We sent a lot of wood to New Page last winter. I hope the bankruptcy is a good thing for them in the long run. If New Page were to shut down the ripple effect would be felt not only in Maine, but New Hampshire, Vermont and even New York.

[Jamie_C]

scary news for me also in nova scotia as new page was responsible for 85% of my income .just bought a harvester in april so now we will have to see how things go .oh well if it was easy everyone would do it .

Looks like it's time to get in bed with Irving or HC Haynes for all the private land guys in our end of the province.

[snowstorm]

scary news for me also in nova scotia as new page was responsible for 85% of my income .just bought a harvester in april so now we will have to see how things go .oh well if it was easy everyone would do it .

what did you buy for a harvester??

[chevytaHOE5674]

That report ain't necessarily bad news it says that they are reorganizing

Smurfit Stone container said the same thing, that bankruptcy would allow them to become more profitable. Now their mills are shut down and the local mill is a pile of rubble.

[timbuck2]

bankruptcy is the begining of the end

[SwampDonkey]

The Newpage mill in NS has been loosing $4M a month apparently and they said the pensions are at high risk of going poof. That's the way it always works up here when mills fail, the pension takes a hit since as the pensioners are not secured creditors. Langedder used the pension to finance his operations until it was time to jump ship. Legal extortion.

[ahlkey]

With that much debt they will have to cut a lot of expenses quickly to get creditors to agree to a new plan of payment.  No doubt we will see a lot of mill closures or plant sales in the near future. The fact they have only been profitable for one year and they have 1 Billion in debt the first goal of the creditors will be to see a real short term plan that is profit driven and that will likely only be done by cutting jobs & benefits.  It is always hard to predict but I would prepare for even tougher times ahead before things start to turn around.  That is really sad news indeed as so many people in the community are dependent on NewPage.

[Skiddah]

http://www.mainebiz.biz/article.php?RF_ITEM%5B%5D=Article$0@47950;Article

Toward the end of the article, "Cerberus Capital Management of New York, which acquired the Rumford mill in 2005 through a $2.3 billion buyout of MeadWestvaco, does little to combat private equity’s opportunistic reputation, at least in the choice of its moniker. Named for the three-headed mythical dog that guarded the gates of Hades, Cerberus has failed to invest in the NewPage mill, blaming its poor performance on market influences, Lugdon says. "

Without investment, how do you expect a business to be profitable?  I see this as a problem with more mills going the way of private equity, hedgefund investments, etc.  They're all about the bottom line, as most businesses should be.  The trouble is, they're more than willing to pull the plug at the first sign of trouble and cut their losses.  To me, these mills seem like "stocks" that they company can just trade away, sell, etc. at the first sign of trouble.

From what I have read, coated paper, NewPage's bread and butter, is down in market but still viable, if not profitable.

I feel bad for you friends in Nova Scotia, it seems that NewPage's Canadian operations have really been bearing most of the losses as of late.  Things don't look good that side of the border.

[duke]

 Well I think its about time we raise prices to what will keep us in NORTH America, USA and Canada. We should lobby the government stores that buy cheap off shore from who knows where and with CHEAP LABOUR and LITTLE TO NO ENVIROMENTAL OR LABOUR LAWS!!!! I know I know. But some-one has to say it. Sorry I do not want to go any farther. This is a great place to learn.
duke

[SwampDonkey]

As we all have seen or experienced, going cheap has it's consequences world wide. Jobs lost here, no environmental standards or employment benefits over there. There are also a lot of puppet companies. When Landegger's Nackawick mill went broke, he didn't, he was first creditor in line. I believe he is CEO of Parson's and Whitmore, they didn't go broke either. It's quite a racket.

[Woodhog]

Well it didnt take long........

In todays mail a note from Bowater's ... Price of spruce and fir pulpwood is going down 3 dollars per tonne.

From a slowly go broke price of $38.75 per tonne to a faster going broke price of $35.75 per tonne.

[240b]

So, for this area what this all means is, everyone is going to put all the pulp in the chip pile and now the biomass market will go from bad to hey lets just stay home.  Although, the ground is so wet you can't work anyways. A bunch of guys got equipment stuck out in the woods from the flooding we had.  The local consultant was rattling off a list of names of who is most likely going out of business.  pretty grim

[snowstorm]

new page is not going to close up in rumford. they filed for protection. they may not pay there light or phone bill. but they do have to pay for what they need to stay in bussiness. they have to get there product to market i know they have been told to pay for that. i have a little more imfo on them than what you read in the paper

[Skiddah]

Snowstorm,

Care to shed any more light on your inside information?  I have friends who work in Rumford and at the chips mills and the outlook isn't very rosy according to them. Really there's no guarentee that any of NewPage's mills are safe.  Filing for "protection" gives you some lattitude, but you're also under the supervision of the bankruptcy court.  They have quite a say in this.  What if the court said that you have to shutter mills to lower your operating costs?

For those of us in Maine, what if NewPage went the way of Great Northern Paper (Bowater) and the subsequent owners of the mill.  The two mills sat idle for a long time looking for new ownership.  Should that happen we'll be in for a long ride.  We can count on the price of pulp drastically coming down.  Not that the price of pulp has been very sound in the last few years, but we're making enough to get by on it now.  Take a major player out of the field (NewPage) and watch the others (Sappi, Verso) let the bottom drop out of the market and do business with those that can survive at a reduced rate.

We can all come up with a laundry list of companies that filed for "protection" and ended up defunct.  As was mentioned on here before, bankruptcy is often the first step...

[Woodhauler]

THEY ARE NOT PAYING FOR THERE WOOD! They owe me for 2 weeks worth of deliveries! Wood buyer called today and said they would release the payment if i signed a paper they are sending saying i will keep sending them wood! Guess i will sign it and then wait and see what happens with my money! Some truckers was leaving loaded from the chip plant and taking the wood with them!!

[SwampDonkey]

I wouldn't sign nothing unless I was made a creditor on the list for my money. We had mills not pay for several weeks and it always ended in several $100,000 owed and they closed the doors. Don't do it thinking your a good guy, experience tells me you'll be burned bad. Your just keeping that slob's paycheck coming in.

[furltech]

Nobody got paid up here either

[240b]

sounds like Berlin all over again

[grassfed]

Another story...http://www.rumfordfallstimes.com/news/story/05newpage-path37

[KyMasterLogger]

i got a letter in the mail today stating they were filing bankruptcy. they still owe me for 2 loads.

[mill_boy]

I think im getting kicked square in the butt. Ive been cutting pulp by hand since i came out of high school and a little bit before that. im next in line to get on a harvester as well.

[mad murdock]

welcome to the form mill boy.  Mill closures are not a good deal for anyone.  So many mills have closed across N. America in the last decade or 2.  I wasn't here in the PNW when the spotted owl debacle came down, but that was a death blow to hundreds of mills within a matter of a couple years.  Mergers, shutdowns, etc.  I think that if a guy wants to look to a future in the woods, it will require a lot of "outside the box" strategy.  I look at my tree farm and am always thinking of ways that I can make something that I will be able to sell/trade/barter for what I may need for myself and my family, as this economy begins to unwind, things are going to get crazier and crazier.

[Skiddah]

Bad news in Nova Scotia - http://www.enfieldweeklypress.com/2011/09/27/local-company-owed-money-by-newpage/

[Jamie_C]

There is one contractor in Cape Breton that is owed just over $280,000 for wood ... The largest single amount owed to any wood supplier by a large margin

[mill_boy]

There is one contractor in Cape Breton that is owed just over $280,000 for wood ... The largest single amount owed to any wood supplier by a large margin

I do believe that is Brent maccinis. new page owed/owes about that much. he lives in french vale and has a small sawmill and firewood business as well.

[Jamie_C]

There is one contractor in Cape Breton that is owed just over $280,000 for wood ... The largest single amount owed to any wood supplier by a large margin

I do believe that is Brent maccinis. new page owed/owes about that much. he lives in french vale and has a small sawmill and firewood business as well.

Nope wasn't Brent, if memory serves me correctly the next closest wood supplier was owed about $100,000 less than the guy that was owed about $280,000.

[mill_boy]

ok im just goin by what i heard.

[Keltic]

My neighbor is owed 45K by NewPage, big hit for a two man operation.