Marcal Files for Bankruptcy Protection

Marcal Paper Mills, Inc., headquartered in Elmwood Park, NJ, has filed a voluntary petition under Chapter 11 of the Federal Bankruptcy Code in the United States Bankruptcy Court for the District of New Jersey. The company, a manufacturer of tissue and towel products, says it has sufficient funds to continue its normal business operations, including on-going employee, supplier and customer obligations.

Nicholas Marcalus, company chairman and CEO, said a big problem has been the soaring energy costs, which have climbed 40 percent in the past 12 months, the company has had to absorb.

"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," Marcalus said.

Marcal has sufficient liquidity to operate and normalize relations with its vendors in order to ensure timely service and merchandise flow to its customers, which include leaders in the supermarket, hospitality, office supply and restaurant industries. The company anticipates continued support from its suppliers and customers as it pursues alternatives for reorganizing under Chapter 11.