Corporacion Durango Files for Bankruptcy

Corporacion Durango, Mexico’s largest paper maker, has filed for bankruptcy protection as it struggles with higher raw materials costs and the weak U.S. economy, reports Reuters.

The company also filed a Chapter 15 petition before U.S. bankruptcy court for the Southern District of New York to help shield it from U.S. creditors while it reorganizes. Durango’s U.S. holding company, Paper International and subsidiary Fiber Management of Texas Inc, also filed for Chapter 11 bankruptcy protection.

In court documents, rising energy costs, the U.S. economic downturn, increased foreign competition, and appreciation of the Mexican peso were given as reasons for taking these actions.

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