Quebecor World Emerges

Quebecor World,the Montreal-based printing concern,has emerged from Chapter 11 bankruptcy.The firm entered bankruptcy in January,2008.Having restructured its business,it will be known as World Color Press,Inc.During restructuring,the company continued to be an important employer at its plants in Fairfield,Pennsylvania and elsewhere.Quebecor,Inc. owns World Color Press,and is led by CEO Pierre Paladeau.R.F. Donnelley and Sons Co.,a Chicago-based commercial printing rival,had made a bid of 700 million dollars in cash and 394 million in stock for the troubled Quebecor World in May,2009.
Jacques Mallette,President and CEO of Quebecor World,said it was an important and exciting day for the Company,its customers,suppliers and employees.The restructuring and reorganizing process has made us financially healthier and allowed us to start fresh with a strong balance sheet and a leaner cost structure.We believe the Company is now better positioned to meet the present and future competition in the industry and to create value for our stakeholders,Mr.Mallette stated.
World Color Press will continue to produce advertising inserts and circulars,catalogs,magazines,books,directories,digital premedia and other products.It has about 20,000 employees in some 90 facilities in theU.S.,Canada,Argentina,Chile,Brazil,Mexico,Colombia and Peru.Its parent,Quebecor,Inc.,trades on the Toronto Stock Exchange.

Grappling With The Bear

Financial advisors are busy grappling with the economic bear.Extreme volatility may occur this week as the markets react to the Federal Reserve's interest rate decision on Wednesday and the employment report on Friday,as well as other data.Jessica Paige of Paige Capital Management advises staying in cash.The debt market is in a crisis,and many companies will file for bankruptcy.One that has already done so is Quebecor World(QBRWF),a Montreal-based printing concern.The company,which prints textbooks,books of the month,catalogs and pamphlets,cites a need to restructure itself.Local management in Fairfield,Pennsylvania says they will not be reducing staff or cutting wages and benefits.The firm has secured one billion dollars U.S. in financing from Morgan Stanley(MS) and Credit Suisse(CS).Ms. Paige observes the market is going through a transition phase right now.Anything you want to buy will be cheaper in six months.The S and P 500 index will drop to 1200 within 6-12 months.Robert Hormats of Goldman Sachs(GS) notes that the economy is heavily in debt-much of it bad.Decoupling of other economies from the U.S. economy hasn't happened.The financial and goods markets of the U.S. are very important to other countries.It is hard for them to grow robustly without the U.S. markets.Economist Ben Stein feels the market was ridiculously oversold by hedge fund traders.They are making a fortune by shorting the market.Three hundred trillion has been knocked out of the market.Federal Reserve chairman Ben Bernanke needs to fight them and be as ruthless as they are.Jim Awad of J.P. Stewart Asset Management says that it is the most volatile market in his forty years in the business.There is a fear of more write-downs,and it will take time to get over that.According to Joe Battipaglia of Stifel Nicolaus,the corrective process is well underway,but you still have to work through the credit mark-downs.We are one-third of the way through.The process has to unfold naturally.While this goes on,some investors are sheltering in tax-free money market funds such as Alpine Municipal MMF/Investor and Vanguard Tax-Exempt MMF.