Coated paper and substrate supplier Appleton Coated (Combined Locks, Wisconsin), struggling under what it characterized as “burdensome debt,” has filed a state petition for receivership to continue operations while it seeks a buyer, according to local press reports. In the United States, filing a voluntary state Chapter 128 petition represents an alternative to bankruptcy, and will allow the company to operate under the supervision of a receiver appointed by the Outagamie County Circuit Court. Its products are used in high-end commercial printing, textbook publishing, label papers, transactional printing and a variety of specialty, packaging and custom applications. The privately owned company was purchased three years ago by 10 members of its management team.
“Despite the best efforts of our employees and ownership group, and the introduction of new products, this step is the best option at this point,” said Doug Osterberg, Appleton Coated’s President and Chief Executive Officer. “While the company has made significant progress in diversifying its product offerings and entering new markets, the overall business climate is very challenging, and operating under a state court-appointed receiver is the best route to transition the business to sustained profitability.” Appleton Coated has 620 employees who will remain employed for now. Declining demand, excess capacity and price competition in coated and uncoated paper markets were cited as problems facing the company. But it added that the growing movement to digital communications combined with unfavourable exchange rates have created overcapacity in the North American markets, which in turn have resulted in falling prices and operating losses for Appleton – as well as for other paper suppliers in the industry.
Appleton Coated files for receivership and seeks a buyer
