Tembec U.S. operation seeks bankruptcy protection

Tembec Inc. said Monday that its U.S. operation has filed for bankruptcy protection.

Tembec Inc. said Monday that its U.S. operation has filed for bankruptcy protection.

Tembec three-month stock chart. ((CBC))

The Canadian forest products company said its Tembec USA LLC filed a petition seeking relief under Chapter Seven of the Bankruptcy Code of the United States.

The division is a non-operating U.S. subsidiary of Tembec.

Tembec USA LLC operated a coated paper mill located in St. Francisville, Louisiana which was idled in July 2007. The property and equipment was subsequently sold to a third party in April 2009.

The company said in a release that Tembec USA LLC currently has obligations totaling $81 million US and assets totaling $1 million.  

As a result of the filing, Tembec will reduce its consolidated accrued benefit obligation by $9 million.