Firm To Continue To Operate Recycling Center
posted July 22, 2008
Caraustar Industries, Inc. announced Tuesday that it has permanently ceased production of uncoated recycled boxboard at its Chattanooga Paperboard mill.
Approximately 67 salaried and hourly employees are affected by the mill closure. Caraustar officials said they "will provide a comprehensive program of separation pay, benefits continuation and job assistance to these employees."
Caraustar will continue to operate the recycling center at this location.
Chattanooga Paperboard had an annual capacity of approximately 60,000 tons. The company expects to retain its Chattanooga customers and service their needs from other Caraustar locations, officials said.
In making the announcement, Thomas C. Dawson Jr., vice president, Mill Group, stated, "The decision to cease production of URB at the Chattanooga mill reflects management's continued focus on maximizing capacity utilization and operating efficiencies in an increasingly challenging economic environment. We are pleased to continue a vital presence in Chattanooga through the operation of our recycling center, which has been beneficial to Caraustar, local municipalities and the Chattanooga community."
Associated with the cessation of paperboard production in Chattanooga, the company will record a pre-tax charge of approximately $7.9 million, of which approximately $5.8 million will be non-cash. This rationalization is expected to generate an estimated $9.0 million in annual pre-tax savings.
Caraustar Industries, Inc. is one of North America's largest integrated manufacturers of 100% recycled paperboard and converted paperboard products.
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