Orchids Paper Products Plans Public Sale of Shares
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LA PALMA — Orchids Paper Products Co., a paper manufacturer, has filed an application with the federal Securities and Exchange Commission to take the company public. Orchids plans to sell 3.2 million shares at between $11 and $14 a share.
The La Palma company produces bath and facial tissue, towels and napkins. Most of the company’s products are sold under generic labels by supermarket chains such as Ralphs, Vons and Lucky.
Orchids plans to use the money to buy back $12.5 million in debt and stock from Miami Beach-based APL Corp., to repay other debt and for working capital, said an attorney for the company, K.C. Schaaf.
The debt to APL, a diversified holding company, was incurred with the April, 1989, acquisition of APL’s paper products division by a group of seven Orchids executives. The executives paid $50 million in a leveraged buyout and assumed an additional $23 million in debt, Schaaf said.
Prudential Securities Inc. of New York City and its European affiliate, Prudential-Bache Securities, will underwrite the sale, which will begin in late summer or early fall, Schaaf said.
From an environmental standpoint, Orchids has had a mixed record.
In May, a pro-recycling group called Californians Against Waste Foundation included Orchids’ Start brand tissues in its guide to products made of recycled material. But in January, 1985, the company settled a civil suit for $100,000, which it paid to San Bernardino County, for allegedly dumping 29 metal drums of glue, paper and chemicals in a vacant lot in Fontana.
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