Buckeye To Close Americana, Brazil Cotton Linter Pulp Production Line

(RTTNews.com) – Buckeye Technologies Inc. (BKI), a manufacturer and marketer of specialty fibers and nonwoven materials, Thursday announced the closure of its Americana, Brazil cotton linter pulp production line. The company will work closely with its customers to continue to meet their needs from its Memphis, Tennessee facility. The closure will lead to the termination of employment for around 60 employees.

The company expects to incur about $2.4 million in restructuring expenses in calendar 2012 and a non-cash asset impairment charge of about $49 million in the October-December 2011 quarter.

The closure is expected to generate around $20 million cash benefit, primarily due to tax benefits related to the investment loss, assuming that the company is able to utilize all its potential cellulosic biofuel credits by June 2016.

Buckeye said it would continue to operate the waste water treatment facility for the shared industrial site, while continuing discussions for the sale of the facility.

Buckeye’s Chairman and Chief Executive Officer John Crowe said, “This closure has become necessary due to the facility’s uncompetitive cost position for the products it makes. This is primarily driven by the high cost of its cotton linter raw material supply.”

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