Paper Manufacturer Champion to Sell Assets, Cut 2,000 Jobs

Champion International Corp. on Wednesday said it plans to cut 2,000 jobs and sell its newsprint, paper recycling and other businesses along with 325,000 acres of Northeast timberland to reverse sagging profits.

The Stamford, Conn.-based company said it will focus on producing more expensive paper products, including magazine and catalog stock and paper for copy machines, spokeswoman Gael Doar said.

In New York Stock Exchange trading, Champion shares closed down 50 cents at $64 per share.

The businesses to be sold employ about 6,200 people, or 26% of the company’s work force, and last year accounted for $1.4 billion in net sales.

Champion plans to cut 2,000 jobs from its remaining businesses by the end of 1999, a reduction of about 11%. Job cuts will include corporate and manufacturing positions, among others, at the company’s Stamford office and a facility in Knightsbridge, Ohio.

Champion said the restructuring moves would result in a charge against earnings of $553 million, or $5.77 a share, in the fourth quarter.

The company has been struggling financially. In the second quarter, it lost 12 cents a share, compared with a profit of 16 cents per share in the second quarter 1996. Champion earned $1.48 a share last year, down from $7.67 a share in 1995 when paper prices were higher.

The company plans to sell its newsprint business, including mills in Lufkin and Sheldon, Texas, and the paper recycling business, which is based in Houston.