Smurfit-Stone Agrees on Bankruptcy Schedule with Shareholders

Smurfit-Stone Container Corp. (Creve Coeur, MO), one of the largest paper recyclers in the United States, has reached an agreement with its shareholders on a schedule for emerging from bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code. The agreement marks a resolution with Mariner Investment Group LLC and Senator Investment Group LP, each an investment advisor to funds under management, as holders of the company’s preferred stock, and funds and accounts managed by P. Schoenfeld Asset Management LP and Fir Tree, Inc., as holders of the company’s common stock. Under the terms of the agreement, some of the common stock of the reorganized company that had been previously earmarked for general unsecured creditors will now be distributed to the company’s current stockholders. Specifically, 2.5% of the new stock will be distributed pro rata to existing preferred stockholders and 2.5% to existing common stockholders. Smurfit-Stone expects to emerge from Chapter 11 by early summer.