Russell-Stanley Holdings, Inc.

August 19, 2005 16:26 ET

Mauser-Werke GmbH & Co. KG to Acquire Assets of Russell-Stanley Holdings, Inc. and Certain of Its Subsidiaries; Hunter Drums Limited Commences Ancillary Proceeding in Canada

BURLINGTON, Ontario--(CCNMatthews - Aug 19, 2005) -

Russell-Stanley Files Prepackaged Chapter 11 Reorganization Cases

Russell-Stanley Holdings, Inc. today announced that it has entered into a definitive asset purchase agreement with an affiliate of Mauser-Werke GmbH & Co. KG ("Mauser") and One Equity Partners, pursuant to which Russell-Stanley and certain of its subsidiaries including Hunter Drums Limited ("Hunter Drums") would sell substantially all of its assets to Mauser. In a separate announcement issued by Russell-Stanley, the Company stated that to effectuate the asset sale under the Purchase Agreement, Russell-Stanley and certain of their U.S. domestic subsidiaries filed prepackaged reorganization cases under Chapter 11 of the Bankruptcy Code and a prepackaged Plan of Reorganization ("the Plan") today.

Hunter Drums has commenced an ancillary proceeding in Canada under the Companies' Creditors Arrangement Act, which is designed to help effectuate the sale of assets to Mauser and the payment of Hunter Drums' liabilities that are not to be assumed by Mauser. Hunter Drums is not a debtor in the U.S. bankruptcy cases and its creditors will continue to be paid in the ordinary course of business.

Russell-Stanley's prepackaged Chapter 11 filing and the commencement of the Canadian court proceedings were conditions of the asset sale and were not due to operational concerns. The Company believes that its underlying business is sound and that the business will be strengthened by a combination with the financially strong Mauser organization. Russell-Stanley's senior management is expected to continue in their current capacity both during the Chapter 11 case and with Mauser after the sale is completed.

"This combination with Mauser will provide the Russell-Stanley business with the additional resources necessary to continue to meet and exceed the expectations of our customers by partnering with a truly global leader in industrial packaging," stated Ronald M. Litchkowski, President and Chief Executive Officer of Russell-Stanley. "During our Chapter 11 reorganization, we will continue to operate as usual and will fulfill all of our customer obligations during this process. Our commitment to our customers and vendors remains steadfast."

Russell-Stanley expects to emerge from Chapter 11 and close the transaction with Mauser within the next few months subject to customary closing conditions contained in the Purchase Agreement, including receipt of all necessary bankruptcy court and other approvals. The Canadian court proceedings will continue after the closing solely to facilitate the payment of Hunter Drums' liabilities that are not to be assumed by Mauser and the completion of post-closing matters in connection with the asset sale under the agreement with Mauser.

About Russell-Stanley

Russell-Stanley Holdings, Inc. is North America's largest plastic drum manufacturer, second largest steel drum manufacturer, and a leading industrial container supply chain management company. Information on the company can be found at www.Russell-Stanley.com.

About Mauser

Mauser-Werke GmbH Co. KG is a global leader in industrial packaging, with its headquarters in Bruehl, Germany. More information on the company can be found at www.mauser-werke.com.

Contact Information

  • Brunswick Group
    Ellen Gonda/Diana Drobiner, 212-333-3810