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Pope & Talbot Announces Voluntary Chapter 11 FilingSalem-News.com
"We want to assure our customers, employee colleagues and our communities that, although our business environment continues to present difficult challenges, Pope & Talbot is endeavoring to operate business as usual," - Harold Stanton, President and CEO
(PORTLAND, Ore.) - Pope & Talbot, Inc. (PTBT.PK) announced today that, in order to address its financial challenges and to support efforts to be a more efficient organization, the company has filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code.
Pope & Talbot's Board of Directors, in a unanimous decision, directed the company to take this action as the best alternative for the long term interests of the company, its employees, customers, creditors, business partners and other stakeholders.
"We want to assure our customers, employee colleagues and our communities that, although our business environment continues to present difficult challenges, Pope & Talbot is endeavoring to operate business as usual," said Harold Stanton, President and CEO.
"We have worked hard to preserve liquidity during this tough situation and this reorganization is a necessary and responsible step to strengthen the company."
Persistent record low demand for lumber, high priced pulp chips and sawdust, the appreciation of the Canadian Dollar and the high cost of debt service have combined for an untenable business environment. Pope & Talbot has determined the best alternative is to seek protection and flexibility under both U.S. and Canadian bankruptcy laws. As previously announced, Pope & Talbot obtained protection from its creditors under the Companies' Creditors Arrangement Act (CCAA) of Canada on October 29, 2007. The company will use the protections of Chapter 11 and the CCAA to provide additional time for it to continue its restructuring efforts, which include, but are not limited to, the sale of certain or all of the company's assets.
The lenders under the company's existing senior secured credit facility are providing a "debtor-in-possession" financing facility of approximately $90 million. Subject to court approval in the U.S. and Canada, the financing, together with cash generated from daily operations, will fund current operating needs, including wages, benefits and other operating expenses.
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Pope & Talbot is a pulp and wood products business. The Company is based in Portland, Oregon and trades on the Pink Sheets under the symbol PTBT. Pope & Talbot was founded in 1849 and produces market pulp and softwood lumber at mills in the US and Canada. Markets for the Company's products include the U.S., Europe, Canada, South America and the Pacific Rim. For more information, please check our website and www.poptal.com.
Caution Regarding Forward-Looking Statements
This press announcement and other Company communications may contain statements relating to future performance of the Company that are forward-looking statements. These statements relate to the Company's future plans, objectives, expectations and intentions and may be identified by words like "believe," "expect," "may," "will," "should," "seek," or "anticipate," and similar expressions.
The Company cautions readers that any such forward-looking statements are based on assumptions that the Company believes are reasonable, but are subject to a wide range of risks including, but not limited to, risks associated with future financial results and liquidity including the Company's continued ability to finance its operations in the normal course, fluctuation of the borrowing base and other limitations that may affect the Company's ability to borrow under its revolving credit facilities or otherwise, the Company's relationship with and payment terms provided by its trade creditors, additional financing requirements, the results of renegotiating certain key commercial agreements, the effect of commodity and raw material prices, foreign currency fluctuations, the effect of U.S. housing market conditions and other uncertainties previously detailed in the Company's filings with the SEC.
Due to these uncertainties, there is an inherent risk that actual results will differ materially from any forward-looking statements. The Company is under no obligation to (and expressly disclaims any such obligation to) update or alter any forward-looking statements whether as a result of new information, future events or otherwise.
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