Smurfit-Stone Container Corp. (SSCCQ) Jumps after Reaching Agreement with Stockholders
Shares of Smurfit-Stone Container Corporation (OTC: SSCCQ) jumped more than 20% in today�s trading. The penny stock reached a high of $0.22 in early trading and at last check was up 19.05% to $0.20, with volume up from daily average of 5.96 million to 6.29 million. Chicago, Illinois-based Smurfit-Stone is a manufacturer of paperboard. It is also involved in paper recycling and paper-based packaging. The company conducts its business operations through Smurfit-Stone Container Enterprises Inc., which is its wholly owned subsidiary. Smurfit-Stone filed for a Chapter 11 plan in a Delaware bankruptcy court in December 2009.
The spike in the penny stock follows the company�s announcement that it has reached an agreement with Mariner Investment Group LLC and Senator Investment Group LP. According to the terms of the agreement, some of the new common stock of Smurfit-Stone, which was as per previous plan supposed to be distributed to the general unsecured creditors of the company, will now be distributed to current stockholders of the company. As per the arrangement, 2.25% of the company�s new common stock pool will be distributed on a pro rata basis to the company�s existing preferred stockholders and another 2.25% will be distributed on a pro rata basis to existing common shareholders.
Commenting on the agreement, which has received the support of Official Committee of Unsecured Creditors, Patrick J. Moore, chairman and CEO of Smurfit-Stone, said that the agreement is a major achievement for the company and positions the company well to emerge from a bankruptcy in the coming few weeks. The penny stock has reacted positively to this development.
The penny stock has a 52-week range of $0.06-$1.11. Currently, the stock is trading below its 50-day and 200-day moving averages.
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