Nearly 120 employees of Smurfit-Stone Container Corp. here were told Monday that their employer's business is being acquired by RockTenn, the Norcross, Ga.-based packaging and paper company, for $3.5 billion.
"The Lewisburg plant has a bright future," Smurfit-Stone General Manager Jeb Bell said from his office in Humboldt, Tenn., where he oversees the corrugated box factory here and four other plants. "In the last four years, we've invested over $4 million in the plant. It's a cost-efficient and well-run plant."
Bell did not anticipate increased production or employment; "Not without further capital investment. The plant is at a high utilization right now."
Jennifer Hoke is Smurfit-Stone's human resources manager.
"It's too early to tell" whether the plant here will have a name change, Hoke said from her office in Chattanooga. The Lewisburg plant operates three shifts on a 24-hour-a-day schedule with approximately 90 hourly workers and some two-dozen salaried employees.
RockTenn's cash and stock deal for Smurfit-Stone comes seven months after Smurfit was released from U.S. Bankruptcy Court protection with greater profit potential and lower debt, according to a Reuters news report. Chicago-based Smurfit sought protection from creditors after raw materials' costs increased at the same time demand dropped and credit markets tightened.
Directors of both companies approved the transaction that's expected to close after March and before July, the businesses said in a joint statement. The deal must also be approved by regulatory authorities and stockholders. Smurfit-Stone stockholders will receive RockTenn stock and cash, depending on their holdings.
Smurfit-Stone has 105 plants. All manufacture boxes.
"It will be business as usual," Bell said of his expectation for the plants in Tennessee, Mississippi and Arkansas. "And, overall, the combination of these companies is a very strong position in the marketplace. That can't bode anything but good for the plant" in Lewisburg.
RockTenn's Chairman and Chief Executive Officer, James A. Rubright said, "RockTenn's acquisition of Smurfit-Stone is another major step in our transformation of RockTenn to be the most respected company in our business with a laser focus on exceeding our customers' expectations and creating long-term shareholder value. The containerboard and corrugated packaging industry is a very good business and U.S. virgin containerboard is a highly strategic global asset."
Lewisburg Industrial Development Director Greg Lowe said, "We hope the news of RockTenn's acquisition of Smurfit-Stone will mean a positive outcome for the facility and its employees in Lewisburg. The Lewisburg Smurfit-Stone facility has been one of the more productive and valuable facilities in the Smurfit-Stone family and we intend to insure that RockTenn and Smurfit-Stone recognize its continued productivity and value throughout the acquisition process."