Marcal files Chapter 11.

(From AFX Europe (Focus))

NEWARK, N.J. (AFX) - Marcal Paper Mills Inc., a maker of toilet paper, kitchen towels, napkins and facial tissue, on Thursday filed a voluntary Chapter 11 reorganization bankruptcy petition and blamed rising energy costs.

The privately held company operated for four generations by the Marcalus family said it has enough money to continue normal operations, including "on-going employee, supplier and customer obligations."

The Elmwood Park-based company added it has "sufficient liquidity to operate and normalize relations with its vendors in order to ensure timely service and merchandise flow to its customers."

In a statement, Chairman and Chief Executive Nicholas R. Marcalus said, "The price increases in energy have proven to be immensely difficult. Demands by our lenders created liquidity pressures which caused the company to file for the continued restructuring under Chapter 11."

"We believe that the decision to file, although difficult, was in the best long-term interest of our company, employees, customers, vendors and other valued business partners. We plan to take advantage of the opportunities presented by this restructuring to address both our financial and operational issues in order to position the company for long-term success," said Marcalus, grandson of ...