Once-praised box firm closes after 76 years No reason given for company's demise

May 14, 1993|By Ross Hetrick | Ross Hetrick,Staff Writer

Maryland Paper Box Co., a 76-year-old company that employed nearly 300 workers a year ago, has closed its operation in Baltimore County and sold some of its customer accounts and inventory to an Illinois packaging company.

The privately owned company, which made paper boxes and shopping bags for department stores, laid off all but a few of the remaining 14 employees last Friday, according to Leroy E. Martin, president of Local 1859 of the United Paperworkers of America, which represented workers there. Three weeks before that, the company laid off about 130 workers, saying they had no money to pay them, he said.

The company's financial plight was further highlighted yesterday three creditors filed a petition with the U.S. Bankruptcy Court to place the company in involuntary Chapter 7 bankruptcy, according to Howard A. Rubenstein, an attorney for Maryland Paper Box.

"The company will respond in a manner consistent with the goals maximizing the value of the company's assets for the benefit of its creditors," he said.

In a brief statement released yesterday, the company said it was closing and that its assets were "being liquidated in an or

derly manner, with the proceeds being paid to the company's secured creditors."

The statement did not explain why the company was closing or what would happen to benefits due employees. Malcolm Mahr, the chief executive officer, refused to comment on the matters earlier this week.

Field Container Co. Limited Partnership, a large packaging company based in Elk Grove Village, Ill., has bought some of the customer accounts as well as a portion of the inventory of partially completed boxes for an undisclosed amount. Field Container also plans to hire an unspecified number of sales personnel from Maryland Paper Box to assist with the accounts.

Field Container also owns Eastfield Corp., a box making company in Baltimore. That operation has 124 workers and makes boxes for cake mixes, ice cream and other retail products, David Thompson, a Field spokesman, said.

Field Container, which has annual sales of about $500 million and more than 3,000 workers, owns eight folding carton plants, five ink plants and a recycled paperboard mill in Michigan.

Owned by the Mahr family, Maryland Paper Box was founded in Baltimore in 1917 and moved to Baltimore County in 1963.

While the company has apparently struggled recently, Maryland Paper Box has enjoyed a good reputation as it supplied a number of national companies, many of which saw sales decline during the recent recession.

As recently as last year, Maryland Paper Box was named Manufacturer of the Year for 1991 by the Retail Packaging Manufacturers Association, a trade group based in Cincinnati, Ohio.

The award was based on balloting by distributors who purchase paper boxes, according to Vicki L. Miller, convention coordinator for the association.

Out of a field of 117 box manufacturers, Maryland Box got nearly half of the votes cast by about 180 distributors participating in the poll. "They won by a landslide," she said.

But when the distributors were polled again in 1992, Maryland Box received only a handful of votes, Ms. Miller said. "It did kind of surprise me," she said.

Mr. Martin said about 95 percent of the company's business consisted of supplying boxes and bags to department stores such as Hecht's, Macy's and Penney.

R. Mickey Gorman, president of the National Paperbox Association, said box manufacturers are particularly sensitive to the economy because demand for their product fluctuates with consumer spending.

L "To a certain extent we are a bellwether industry," he said.

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