The PBGC has taken over the pension plan of Marcal Paper Mills Inc., Elmwood Park, N.J., the agency announced today.
Marcal Paper filed for Chapter 11 bankruptcy protection in November 2006, and sold substantially all of its assets to NexBank SSB, an affiliate of Highland Capital Management, on Jan. 29, according to a news release from the PBGC. That transaction closed May 30 and did not include the pension plan.
The PBGC estimates that the plan is 73% funded, with $18.7 million in assets to cover $25.7 million in benefit liabilities. The agency expects to be responsible for $5.4 million of the $7 million shortfall.
Officials at Marcal Paper and Highland Capital were unable to immediately comment.