Lincoln Paper and Tissue files for bankruptcy, expects to auction mill
Lincoln Paper and Tissue LLC filed for Chapter 11 bankruptcy protection on Monday, announcing that the mill will likely be auctioned off in 45 days, the Bangor Daily News reported.
Co-owner Keith Van Scotter told the paper that he didn’t know whether a potential buyer would continue to operate or scrap the mill.
The mill, the town’s second-largest taxpayer and third-largest employer, has about 179 workers, down from 400 in 2013.
Van Scotter told the newspaper that the company struggled after recovering from a smelt water explosion in a chemical recovery boiler in November 2013. The loss of the boiler led to about 185 layoffs, ended paper production at the mill and forced it to buy pulp from off-site sources.
The company claimed between $10 million and $50 million in both assets and liabilities in its bankruptcy filing.
A Worker Adjustment and Retraining Notice, required at least 60 calendar days in advance of possible plant closings and mass layoffs, was given to the mill’s employees in case a buyer doesn’t keep the mill producing paper.
The mill produces specialty tissue rolls for party goods, food service, medical consumables and other uses.
The Maine Pulp & Paper Association said in a statement that it hopes that the bankruptcy process will serve as the appropriate mechanism for repaying creditors, ensuring existing jobs and securing a buyer interested in continuing mill operations.
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