Citation Corporation Exits Bankruptcy - KTRE.com | Lufkin and Nacogdoches, Texas

05/25/05 - Lufkin

Citation Corporation Exits Bankruptcy

by Stuart Burson

It was September of last year when Citation Corporation filed for chapter eleven bankruptcy protection. Now, less than a year later, the company announced Tuesday that it's exiting bankruptcy in a stronger position to compete in the marketplace.

Employees at Citation's Lufkin plant received the good news on Tuesday. The company they work for is no longer under chapter eleven bankruptcy.

"It's very good news not only for our employees but for our customers and our suppliers. It kind of takes that cloud that's been hanging overhead away and we're able to do business as a normal corporation." says Citations General Manager Sam Greene.

Greene says the company fared very well throughout the ordeal.

"I think our corporate manager did a good job of managing this bankruptcy. We didn't spook our customers or our vendors or our employees. It was pretty much business as usual here. We were able to keep on going, we didn't have any major layoffs here or any of the other divisions."

Citation employs around 680 East Texans. Corporate leaders have watched those workers keep up a great attitude.

"The employees have been real positive through it. We've had meetings every quarter, Sam has, with thirty to fifty employees and he's kept them up to date on what's going on." says Citation's Lufkin Human Resource manager James Covington.

One member of the management team here was laid off from the Abitibi paper mill. He was then snatched up by Citation corporation, only to later receive the news of the bankruptcy filing.

"It was a little disconcerting at first when we first filed in September, but things have run real smooth through the whole process, and our hats have to go off to the corporate team for being as well prepared as they were." says Controller Kenny Baker.

Prior to the bankruptcy filing, Citation had a total debt of $550 million. The company claims cash flow problems related to a sluggish economy, reduced orders, and the rising costs of steel scrap and other commodities caused the bankruptcy. But now, Citation's debt has been reduced to $210 million.

Citation headquarters are in Alabama. The company has more than five-thousand employees in 20 different locations.

The Lufkin plant forges parts for cars and trucks including steering braking and engine parts.

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