Case #4 (Stone Container)

Case #4 (Stone Container) - FIN 450 Stone Container Corp...

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FIN 450 Stone Container Corp. Case # 4 Submitted to: Prof. Thomas J. Paup Date: October 17, 2007 10/17/2007
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Stone Container Corp. The Problem Stone Container Corporation has been going through a difficult time during the four years after the acquisition of Consolidated-Bathurst Inc. They have accumulated more than $3.3 billion in debt making the company highly leveraged and to add to their problems the paper and liner board industry has been going through a low in their cycle where prices were significantly decreased. Stone Container Corp. (SCC) has also seen its stock dropped by more than 50% during a time when the market was considered bullish. A first quarter loss of $0.91 per share was about to be announced to its shareholders. Stone Container Corp. executives are looking for some advice on how to deal with their pressing financial situation. Ever since World War 1 and the Great Depression it has been the financial policy of Stone Container Corp. to be as debt free as possible by financing and paying off loans as fast as possible. They had been doing well with this policy until a few years ago when they had become overwhelmed and stretched thin by
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This note was uploaded on 04/10/2008 for the course FIN 450 taught by Professor Paup during the Spring '07 term at Eastern Michigan University.

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Case #4 (Stone Container) - FIN 450 Stone Container Corp...

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