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Marcal Paper Mills, Inc. Opting to Amend Reorganization Plan and to Sell Company
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Elmwood Park, New Jersey, USA, 02 October 2007 -- /PRNewswire/ -- Marcal Paper Mills, Inc., one of the nation's best known manufacturers and distributors of bath tissue, kitchen towels, napkins, and facial tissue, announced today that the company has filed its intent to proceed with an amended plan of reorganization and sale process with the United States Bankruptcy Court for the District of New Jersey.

"After expending a considerable amount of time and effort exploring various restructuring alternatives, we have concluded that a sale of the company as part of a plan of reorganization - while we continue to operate in the ordinary course of business - is the best way for us to provide continuing employment to our loyal people, ensure our ongoing relationships with our many valued customers and vendors, and maximize value for the benefit of our creditors," said Nicholas Marcalus, company chairman and CEO.

Pending the submission of the anticipated amended plan, the company and its investment banker, NatCity Investments, Inc., will proceed with an orderly and efficient sale process with the object to close a transaction by year end.

"Importantly, our company's operations will continue in the ordinary course of business with funding from our DIP lenders. This will ensure the continued employment of our dedicated employees, payment of all of our post-petition obligations, and high-quality service to our customers. Unfortunately, the tightening of the credit markets and inability to meet certain closing conditions under the existing plan of reorganization requires the company to pursue an alternative strategy for the best interests of all stakeholders," added Marcalus.

About Marcal Paper Mills

Marcal, founded in 1932, is a privately-held, fourth generation family business. It employs more than 900 people in its Elmwood Park, New Jersey, and Chicago, Illinois, manufacturing operations. The company produces more than 160,000 tons of finished paper products, including bath tissue, kitchen towels, napkins, and facial tissue, which are distributed to retail outlets for home consumption and to distributors for away-from-home use in hotels, restaurants, hospitals, offices, and factories. For more than 50 years, Marcal has been a leader in recycling recovered paper as a source of high-grade cellulose fiber for manufacturing tissue products. Each year, Marcal recycles more than 200,000 tons of recovered paper. Marcal's slogan, "Paper from Paper, Not from Trees," (R) symbolizes the commitment of the company to sustainable manufacturing.

Source: Marcal Paper Mills, Inc.


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